BILL NUMBER: SB 1330	ENROLLED
	BILL TEXT

	PASSED THE SENATE  AUGUST 19, 2010
	PASSED THE ASSEMBLY  AUGUST 16, 2010
	AMENDED IN ASSEMBLY  AUGUST 9, 2010
	AMENDED IN SENATE  MARCH 25, 2010

INTRODUCED BY   Committee on Judiciary (Senators Corbett (Chair),
Hancock, Harman, Leno, and Walters)

                        FEBRUARY 19, 2010

   An act to amend Sections 31, 490, 490.5, 654.3, 728, 1246, 1301,
3152, 4040, 4076, 4980.44, 4999.2, 4999.7, 6213, 7028, 7108.5,
8520.2, 8676, 8761, 9889.20, 11344, 19596.2, 19850.6, 23356.2,
25503.42, and 25658.4 of, and to amend and renumber Section 19605.10
of, the Business and Professions Code, to amend Sections 1185,
1363.03, and 2954 of the Civil Code, to amend Sections 234 and 425.16
of, and to repeal Sections 128.6, 209, and 349 of, the Code of Civil
Procedure, to amend Sections 8971, 14035, 33128.3, 42238, 42605,
42606, 44346.5, 44856, 45103.1, 49701, 52055.770, 52165, 53302,
60852.3, 67302.5, 69458, 69460, 69613, 69999.14, 69999.18, 69999.20,
87482, 88003.1, and 89267.5 of, and to repeal Section 51241 of, the
Education Code, to amend Sections 354.5, 2157, 2157.2, 2225, 11100,
and 13307 of the Elections Code, to amend Section 1118 of the
Evidence Code, to amend Section 7572 of the Family Code, to amend
Sections 2089.12, 2089.23, 5655, 9011, and 12013 of the Fish and Game
Code, to amend Sections 3884.2, 5931, 6047.12, 15061, and 71031 of
the Food and Agricultural Code, to amend Sections 7906, 8588.1,
8879.72, 11011.1, 11011.2, 11126, 12715, 13302, 15491, 15820.911,
16724.5, 16731.6, 22898, 25331, 31855.9, 53601, 56375.2, 56668,
63049.62, 63049.67, 65080, 65583, 66540.12, 66540.32, 70375, 70391,
76000, 76000.5, 76104.6, 91530, and 91533 of the Government Code, to
amend Sections 86, 652, 1176, 5864, and 6035 of the Harbors and
Navigation Code, to amend Sections 1261.5, 1289.4, 1348.8, 1357,
1357.50, 1358.4, 1358.12, 1358.91, 1367.66, 1418.21, 1429, 1499,
1568.03, 1569.69, 1599.645, 1736.5, 1798.200, 13221, 25396, 44272,
50843.5, 103526.5, 114850, 116064.2, 116540, 124991, 128730, 130060,
and 130251 of, and to repeal Section 112877 of, the Health and Safety
Code, to amend Sections 38.5, 1063.1, 1063.2, 10136, 10192.4,
10192.81, 10192.12, 10192.20, 10198.6, and 10700 of the Insurance
Code, to amend Sections 226.6 and 273 of the Labor Code, to amend
Section 699.5 of the Military and Veterans Code, to amend Sections
290.011, 293, 336.9, 597.5, 626.10, 831.5, 851.8, 1000.1, 1120, 1170,
1202.4, 1202.8, 1203.098, 1203.4, 1229, 1230, 1231, 1233.1, 1233.7,
1463.23, 6126.1, 6126.5, 6128, 6131, 11170, 11411, 13821, 13823.16,
13848.6, and 14029.5 of, and to repeal Chapter 3 (commencing with
Section 1228) of Title 8 of Part 2 of, the Penal Code, to amend
Sections 10100, 10101, 10102, 10103, 10103.5, 10104, 10105, 10262.5,
and 10344 of the Public Contract Code, to amend Sections 2621.7,
4590, 5842, 25402.10, 48010, and 48027 of the Public Resources Code,
to amend Sections 281, 399.20, 777.1, 851, 2881, 5411, 10009.1,
99233.2, 99312, and 185036 of the Public Utilities Code, to amend
Sections 69, 69.3, 276, 6018.6, 6248, 6363.4, 7104, 7104.2, 30461.6,
41007, 41011, 41030, and 41136 of the Revenue and Taxation Code, to
amend Sections 149.9 and 30918 of the Streets and Highways Code, to
amend Sections 1611 and 10214.6 of the Unemployment Insurance Code,
to amend Sections 4465, 4466, 11709.4, 13386, 21455.5, 27602, 40002,
and 42001.13 of the Vehicle Code, to amend Sections 10608.24,
10608.44, 10853, 10933, 12645, 12647, and 30779 of the Water Code, to
amend Sections 4691, 4860, 5806, 14083, 14085.57, 14105.3,
14132.725, 14154, 14163, 14166.221, 14167.3, 14167.6, 14167.7,
14167.10, 14522.4, 14598, 16124, 18220.1, and 18987.62 of the Welfare
and Institutions Code, to amend Section 5.1 of the Castaic Lake
Water Agency Law (Chapter 28 of the Statutes of 1962, First
Extraordinary Session), to amend Section 1 of the Osteopathic Act, to
amend Section 1 of Chapter 226 of the Statutes of 2009, to amend
Section 2 of Chapter 405 of the Statutes of 2009, and to amend
Section 3 of Chapter 426 of the Statutes of 2009, relating to the
maintenance of the codes.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 1330, Committee on Judiciary. Maintenance of the codes.
   Existing law directs the Legislative Counsel to advise the
Legislature from time to time as to legislation necessary to maintain
the codes.
   This bill would make nonsubstantive changes in various provisions
of law to effectuate the recommendations made by the Legislative
Counsel to the Legislature.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 31 of the Business and Professions Code is
amended to read:
   31.  (a) As used in this section, "board" means any entity listed
in Section 101, the entities referred to in Sections 1000 and 3600,
the State Bar, the Department of Real Estate, and any other state
agency that issues a license, certificate, or registration
authorizing a person to engage in a business or profession.
   (b) Each applicant for the issuance or renewal of a license,
certificate, registration, or other means to engage in a business or
profession regulated by a board who is not in compliance with a
judgment or order for support shall be subject to Section 17520 of
the Family Code.
   (c) "Compliance with a judgment or order for support" has the
meaning given in paragraph (4) of subdivision (a) of Section 17520 of
the Family Code.
  SEC. 2.  Section 490 of the Business and Professions Code is
amended to read:
   490.  (a) In addition to any other action that a board is
permitted to take against a licensee, a board may suspend or revoke a
license on the ground that the licensee has been convicted of a
crime, if the crime is substantially related to the qualifications,
functions, or duties of the business or profession for which the
license was issued.
   (b) Notwithstanding any other provision of law, a board may
exercise any authority to discipline a licensee for conviction of a
crime that is independent of the authority granted under subdivision
(a) only if the crime is substantially related to the qualifications,
functions, or duties of the business or profession for which the
licensee's license was issued.
   (c) A conviction within the meaning of this section means a plea
or verdict of guilty or a conviction following a plea of nolo
contendere. An action that a board is permitted to take following the
establishment of a conviction may be taken when the time for appeal
has elapsed, or the judgment of conviction has been affirmed on
appeal, or when an order granting probation is made suspending the
imposition of sentence, irrespective of a subsequent order under
Section 1203.4 of the Penal Code.
   (d) The Legislature hereby finds and declares that the application
of this section has been made unclear by the holding in Petropoulos
v. Department of Real Estate (2006) 142 Cal.App.4th 554, and that the
holding in that case has placed a significant number of statutes and
regulations in question, resulting in potential harm to the
consumers of California from licensees who have been convicted of
crimes. Therefore, the Legislature finds and declares that this
section establishes an independent basis for a board to impose
discipline upon a licensee, and that the amendments to this section
made by Chapter 33 of the Statutes of 2008 do not constitute a change
to, but rather are declaratory of, existing law.
  SEC. 3.  Section 490.5 of the Business and Professions Code is
amended to read:
   490.5.  A board may suspend a license pursuant to Section 17520 of
the Family Code if a licensee is not in compliance with a child
support order or judgment.
  SEC. 4.  Section 654.3 of the Business and Professions Code is
amended to read:
   654.3.  (a) A dentist, or an employee or agent of a dentist, shall
not charge treatment or costs to an open-end credit, that is
extended by a third party and that is arranged for or established in
a dental office, before the date upon which the treatment is rendered
or costs are incurred, without first providing the patient a list of
the treatment and services to be rendered, the estimated costs of
the treatment and services, and which treatment and services are
being charged in advance of rendering or incurring of costs, and
ensuring that the patient has received the treatment plan required by
subdivision (d).
   (b) A dentist shall, within 15 business days of a patient's
request, refund to the lender any payment received through credit
extended by a third party that is arranged for or established in a
dental office for treatment that has not been rendered or costs that
have not been incurred.
   (c) A dentist, or an employee or agent of that dentist, shall not
arrange for or establish credit extended by a third party for a
patient without first providing the following written notice, on one
page in at least 14-point type, and obtaining a signature from the
patient:


   "Credit for Dental Services
   The attached application and information is for a credit card/line
of credit or loan to help you finance your dental treatment. You
should know that:
   You are applying for a ____ credit card/line of credit or a ____
loan for $____.
   You do not have to apply for the credit card/line of credit or
loan. You may pay your dentist for dental treatment in another
manner.
   This credit card/line of credit or loan is not a payment plan with
the dental office; it is credit with [name of company issuing the
credit card/line of credit or loan]. Your dentist does not work for
this company.
   Before applying for this credit card/line of credit or loan, you
have the right to a written treatment plan from your dentist that
includes the anticipated treatment to be provided and the estimated
costs of each service.
   If you are approved for a credit card/line of credit, your dentist
can only charge treatment and lab costs to that credit card/line of
credit when you get the treatment or the dentist incurs costs unless
your dentist has first given you a list of treatments that you are
paying for in advance and the cost for each treatment or service.
   You have the right to receive a credit to your credit card/line of
credit or loan account refunded for any costs charged to the credit
card/line of credit or loan for treatment that has not been rendered
or costs that your dentist has not incurred. Your dentist must refund
the amount of the charges to the lender within 15 business days of
your request, after which the lender will credit your account.
   Please read carefully the terms and conditions of this credit
card/line of credit or loan, including any promotional offers.
   You may be required to pay interest on the amount charged to the
credit card/line of credit or the amount of the loan. If you miss a
payment or do not pay on time, you may have to pay a penalty and/or a
higher interest rate.
   If you do not pay the money that you owe the company that provides
you with a credit card/line of credit or loan, your missed payments
can appear on your credit report and could hurt your credit rating.
You could also be sued.
   [Patient's Signature]"


   (d) A dentist shall give a patient a written treatment plan prior
to arranging for or establishing credit extended by a third party.
The treatment plan shall include each anticipated service to be
provided and the estimated cost of each service. If a patient is
covered by a private or government dental benefit plan or dental
insurance, from which the dentist takes assignment of benefits, the
treatment plan shall indicate the patient's private or
government-estimated share of cost for each service. If the dentist
does not take assignment of benefits from a patient's dental benefit
plan or insurance, the treatment plan shall indicate that the
treatment may or may not be covered by a patient's dental benefit or
insurance plan, and that the patient has the right to confirm dental
benefit or insurance information from the patient's plan, insurer, or
employer before beginning treatment.
   (e) A dentist, or an employee or agent of that dentist, shall not
arrange for or establish credit extended by a third party for a
patient with whom the dentist, or an employee or agent of that
dentist, communicates primarily in a language other than English that
is one of the Medi-Cal threshold languages, unless the written
notice information required by subdivision (c) is also provided in
that language.
   (f) A dentist, or an employee or agent of that dentist, shall not
arrange for or establish credit that is extended by a third party for
a patient who has been administered or is under the influence of
general anesthesia, conscious sedation, or nitrous oxide.
   (g) A patient who suffers any damage as a result of the use or
employment by any person of a method, act, or practice that willfully
violates this section may seek the relief provided by Chapter 4
(commencing with Section 1780) of Title 1.5 of Part 4 of Division 3
of the Civil Code.
   (h) The rights, remedies, and penalties established by this
article are cumulative, and shall not supersede the rights, remedies,
or penalties established under other laws.
   (i) For purposes of this section, the following definitions shall
apply:
   (1) "Dentist" includes, but is not limited to, a dental
corporation, as defined in Section 1800.
   (2) "Open-end credit" means credit extended by a creditor under a
plan in which the creditor reasonably contemplates repeated
transactions, the creditor may impose a finance charge from time to
time on an outstanding unpaid balance, and the amount of credit that
may be extended to the debtor during the term of the plan (up to any
limit set by the creditor) is generally made available to the extent
that any outstanding balance is repaid.
   (3) "Patient" includes, but is not limited to, the patient's
parent or other legal representative.
  SEC. 5.  Section 728 of the Business and Professions Code is
amended to read:
   728.  (a) Any psychotherapist or employer of a psychotherapist who
becomes aware through a patient that the patient had alleged sexual
intercourse or alleged sexual contact with a previous psychotherapist
during the course of a prior treatment shall provide to the patient
a brochure promulgated by the department that delineates the rights
of, and remedies for, patients who have been involved sexually with
their psychotherapists. Further, the psychotherapist or employer
shall discuss with the patient the brochure prepared by the
department.
   (b) Failure to comply with this section constitutes unprofessional
conduct.
   (c) For the purpose of this section, the following definitions
apply:
   (1) "Psychotherapist" means a physician and surgeon specializing
in the practice of psychiatry or practicing psychotherapy, a
psychologist, a clinical social worker, a marriage and family
therapist, a licensed professional clinical counselor, a
psychological assistant, a marriage and family therapist registered
intern or trainee, an intern or clinical counselor trainee, as
specified in Chapter 16 (commencing with Section 4999.10), or an
associate clinical social worker.
   (2) "Sexual contact" means the touching of an intimate part of
another person.
   (3) "Intimate part" and "touching" have the same meaning as
defined in subdivisions (g) and (e), respectively, of Section 243.4
of the Penal Code.
   (4) "The course of a prior treatment" means the period of time
during which a patient first commences treatment for services that a
psychotherapist is authorized to provide under his or her scope of
practice, or that the psychotherapist represents to the patient as
being within his or her scope of practice, until the
psychotherapist-patient relationship is terminated.
  SEC. 6.  Section 1246 of the Business and Professions Code is
amended to read:
   1246.  (a) Except as provided in subdivisions (b) and (c), and in
Section 23158 of the Vehicle Code, an unlicensed person employed by a
licensed clinical laboratory may perform venipuncture or skin
puncture for the purpose of withdrawing blood or for clinical
laboratory test purposes upon specific authorization from a licensed
physician and surgeon provided that he or she meets both of the
following requirements:
   (1) He or she works under the supervision of a person licensed
under this chapter or of a licensed physician and surgeon or of a
licensed registered nurse. A person licensed under this chapter, a
licensed physician or surgeon, or a registered nurse shall be
physically available to be summoned to the scene of the venipuncture
within five minutes during the performance of those procedures.
   (2) He or she has been trained by a licensed physician and surgeon
or by a clinical laboratory bioanalyst in the proper procedure to be
employed when withdrawing blood in accordance with training
requirements established by the department and has a statement signed
by the instructing physician and surgeon or by the instructing
clinical laboratory bioanalyst that the training has been
successfully completed.
   (b) (1) On and after the effective date of the regulations
specified in paragraph (2), any unlicensed person employed by a
clinical laboratory performing the duties described in this section
shall possess a valid and current certification as a certified
phlebotomy technician issued by the department. However, an
unlicensed person employed by a clinical laboratory to perform these
duties pursuant to subdivision (a) on that date shall have until
January 1, 2007, to comply with this requirement, provided that he or
she has submitted the application to the department on or before
July 1, 2006.
   (2) The department shall adopt regulations for certification by
January 1, 2001, as a certified phlebotomy technician that shall
include all of the following:
   (A) The applicant shall hold a valid, current certification as a
phlebotomist issued by a national accreditation agency approved by
the department, and shall submit proof of that certification when
applying for certification pursuant to this section.
   (B) The applicant shall complete education, training, and
experience requirements as specified by regulations that shall
include, but not be limited to, the following:
   (i) At least 40 hours of didactic instruction.
   (ii) At least 40 hours of practical instruction.
   (iii) At least 50 successful venipunctures.
   However, an applicant who has been performing these duties
pursuant to subdivision (a) may be exempted from the requirements
specified in clauses (ii) and (iii), and from 20 hours of the 40
hours of didactic instruction as specified in clause (i), if he or
she has at least 1,040 hours of work experience, as specified in
regulations adopted by the department.
   It is the intent of the Legislature to permit persons performing
these duties pursuant to subdivision (a) to use educational leave
provided by their employers for purposes of meeting the requirements
of this section.
   (C) Each certified phlebotomy technician shall complete at least
three hours per year or six hours every two years of continuing
education or training. The department shall consider a variety of
programs in determining the programs that meet the continuing
education or training requirement.
   (D) He or she has been found to be competent in phlebotomy by a
licensed physician and surgeon or person licensed pursuant to this
chapter.
   (E) He or she works under the supervision of a licensed physician
and surgeon, licensed registered nurse, or person licensed under this
chapter, or the designee of a licensed physician and surgeon or the
designee of a person licensed under this chapter.
   (3) The department shall adopt regulations establishing standards
for approving training programs designed to prepare applicants for
certification pursuant to this section. The standards shall ensure
that these programs meet the state's minimum education and training
requirements for comparable programs.
   (4) The department shall adopt regulations establishing standards
for approving national accreditation agencies to administer
certification examinations and tests pursuant to this section.
   (5) The department shall charge fees for application for and
renewal of the certificate authorized by this section of no more than
one hundred dollars ($100) for a two-year period.
   (c) (1) (A) A certified phlebotomy technician may perform
venipuncture or skin puncture to obtain a specimen for nondiagnostic
tests assessing the health of an individual, for insurance purposes,
provided that the technician works under the general supervision of a
physician and surgeon licensed under Chapter 5 (commencing with
Section 2000). The physician and surgeon may delegate the general
supervision duties to a registered nurse or a person licensed under
this chapter, but shall remain responsible for ensuring that all
those duties and responsibilities are properly performed. The
physician and surgeon shall make available to the department, upon
request, records maintained documenting when a certified phlebotomy
technician has performed venipuncture or skin puncture pursuant to
this paragraph.
   (B) As used in this paragraph, general supervision requires the
supervisor of the technician to determine that the technician is
competent to perform venipuncture or skin puncture prior to the
technician's first blood withdrawal, and on an annual basis
thereafter. The supervisor is also required to determine, on a
monthly basis, that the technician complies with appropriate
venipuncture or skin puncture policies and procedures approved by the
medical director and required by state regulations. The supervisor,
or another designated licensed physician and surgeon, registered
nurse, or person licensed under this chapter, shall be available for
consultation with the technician, either in person or through
telephonic or electronic means, at the time of blood withdrawal.
   (2) (A) Notwithstanding any other provision of law, a person who
has been issued a certified phlebotomy technician certificate
pursuant to this section may draw blood following policies and
procedures approved by a physician and surgeon licensed under Chapter
5 (commencing with Section 2000), appropriate to the location where
the blood is being drawn and in accordance with state regulations.
The blood collection shall be done at the request and in the presence
of a peace officer for forensic purposes in a jail, law enforcement
facility, or medical facility, with general supervision.
   (B) As used in this paragraph, "general supervision" means that
the supervisor of the technician is licensed under this code as a
physician and surgeon, physician assistant, clinical laboratory
bioanalyst, registered nurse, or clinical laboratory scientist, and
reviews the competency of the technician before the technician may
perform blood withdrawals without direct supervision, and on an
annual basis thereafter. The supervisor is also required to review
the work of the technician at least once a month to ensure compliance
with venipuncture policies, procedures, and regulations. The
supervisor, or another person licensed under this code as a physician
and surgeon, physician assistant, clinical laboratory bioanalyst,
registered nurse, or clinical laboratory scientist, shall be
accessible to the location where the technician is working to provide
onsite, telephone, or electronic consultation, within 30 minutes
when needed.
   (d) The department may adopt regulations providing for the
issuance of a certificate to an unlicensed person employed by a
clinical laboratory authorizing only the performance of skin
punctures for test purposes.
  SEC. 7.  Section 1301 of the Business and Professions Code is
amended to read:
   1301.  (a) The annual renewal fee for a clinical laboratory
license or registration set under this chapter shall be paid during
the 30-day period before the expiration date of the license or
registration. If the license or registration is not renewed before
the expiration date, the licensee or registrant, as a condition
precedent to renewal, shall pay a delinquency fee equal to 25 percent
of the annual renewal fee for up to 60 days after the expiration
date, in addition to the annual renewal fee in effect on the last
preceding regular renewal date. Failure to pay the annual renewal fee
in advance during the time the license or registration remains in
force shall, ipso facto, work a forfeiture of the license or
registration after a period of 60 days from the expiration date of
the license or registration.
   (b) (1) The department shall give written notice to all persons
licensed pursuant to Section 1260, 1260.1, 1261, 1261.5, 1262, 1264,
or 1270 30 days in advance of the regular renewal date that a renewal
fee has not been paid. In addition, the department shall give
written notice to licensed clinical laboratory bioanalysts or
doctoral degree specialists and clinical laboratory scientists or
limited clinical laboratory scientists by registered or certified
mail 90 days in advance of the expiration of the fifth year that a
renewal fee has not been paid and if not paid before the expiration
of the fifth year of delinquency the licensee may be subject to
reexamination.
   (2) If the renewal fee is not paid for five or more years, the
department may require an examination before reinstating the license,
except that no examination shall be required as a condition for
reinstatement if the original license was issued without an
examination. No examination shall be required for reinstatement if
the license was forfeited solely by reason of nonpayment of the
renewal fee if the nonpayment was for less than five years.
   (3) If the license is not renewed within 60 days after its
expiration, the licensee, as a condition precedent to renewal, shall
pay the delinquency fee identified in subdivision (k) of Section
1300, in addition to the renewal fee in effect on the last preceding
regular renewal date. Payment of the delinquency fee will not be
necessary if within 60 days of the license expiration date the
licensee files with the department an application for inactive
status.
  SEC. 8.  Section 3152 of the Business and Professions Code is
amended to read:
   3152.  The amounts of fees and penalties prescribed by this
chapter shall be established by the board in amounts not greater than
those specified in the following schedule:
   (a) The fee for applicants applying for a license shall not exceed
two hundred seventy-five dollars ($275).
   (b) The fee for renewal of an optometric license shall not exceed
five hundred dollars ($500).
   (c) The annual fee for the renewal of a branch office license
shall not exceed seventy-five dollars ($75).
   (d) The fee for a branch office license shall not exceed
seventy-five dollars ($75).
   (e) The penalty for failure to pay the annual fee for renewal of a
branch office license shall not exceed twenty-five dollars ($25).
   (f) The fee for issuance of a license or upon change of name
authorized by law of a person holding a license under this chapter
shall not exceed twenty-five dollars ($25).
   (g) The delinquency fee for renewal of an optometric license shall
not exceed fifty dollars ($50).
   (h) The application fee for a certificate to perform lacrimal
irrigation and dilation shall not exceed fifty dollars ($50).
   (i) The application fee for a certificate to treat glaucoma shall
not exceed fifty dollars ($50).
   (j) The fee for approval of a continuing education course shall
not exceed one hundred dollars ($100).
   (k) The fee for issuance of a statement of licensure shall not
exceed forty dollars ($40).
   (l) The fee for biennial renewal of a statement of licensure shall
not exceed forty dollars ($40).
   (m) The delinquency fee for renewal of a statement of licensure
shall not exceed twenty dollars ($20).
   (n) The application fee for a fictitious name permit shall not
exceed fifty dollars ($50).
   (o) The renewal fee for a fictitious name permit shall not exceed
fifty dollars ($50).
   (p) The delinquency fee for renewal of a fictitious name permit
shall not exceed twenty-five dollars ($25).
  SEC. 9.  Section 4040 of the Business and Professions Code is
amended to read:
   4040.  (a) "Prescription" means an oral, written, or electronic
transmission order that is both of the following:
   (1) Given individually for the person or persons for whom ordered
that includes all of the following:
   (A) The name or names and address of the patient or patients.
   (B) The name and quantity of the drug or device prescribed and the
directions for use.
   (C) The date of issue.
   (D) Either rubber stamped, typed, or printed by hand or typeset,
the name, address, and telephone number of the prescriber, his or her
license classification, and his or her federal registry number, if a
controlled substance is prescribed.
   (E) A legible, clear notice of the condition or purpose for which
the drug is being prescribed, if requested by the patient or
patients.
   (F) If in writing, signed by the prescriber issuing the order, or
the certified nurse-midwife, nurse practitioner, physician assistant,
or naturopathic doctor who issues a drug order pursuant to Section
2746.51, 2836.1, 3502.1, or 3640.5, respectively, or the pharmacist
who issues a drug order pursuant to either Section 4052.1 or 4052.2.
   (2) Issued by a physician, dentist, optometrist, podiatrist,
veterinarian, or naturopathic doctor pursuant to Section 3640.7 or,
if a drug order is issued pursuant to Section 2746.51, 2836.1,
3502.1, or 3460.5, by a certified nurse-midwife, nurse practitioner,
physician assistant, or naturopathic doctor licensed in this state,
or pursuant to either Section 4052.1 or 4052.2 by a pharmacist
licensed in this state.
   (b) Notwithstanding subdivision (a), a written order of the
prescriber for a dangerous drug, except for any Schedule II
controlled substance, that contains at least the name and signature
of the prescriber, the name and address of the patient in a manner
consistent with paragraph (2) of subdivision (a) of Section 11164 of
the Health and Safety Code, the name and quantity of the drug
prescribed, directions for use, and the date of issue may be treated
as a prescription by the dispensing pharmacist as long as any
additional information required by subdivision (a) is readily
retrievable in the pharmacy. In the event of a conflict between this
subdivision and Section 11164 of the Health and Safety Code, Section
11164 of the Health and Safety Code shall prevail.
   (c) "Electronic transmission prescription" includes both image and
data prescriptions. "Electronic image transmission prescription"
means any prescription order for which a facsimile of the order is
received by a pharmacy from a licensed prescriber. "Electronic data
transmission prescription" means any prescription order, other than
an electronic image transmission prescription, that is electronically
transmitted from a licensed prescriber to a pharmacy.
   (d) The use of commonly used abbreviations shall not invalidate an
otherwise valid prescription.
   (e) Nothing in the amendments made to this section (formerly
Section 4036) at the 1969 Regular Session of the Legislature shall be
construed as expanding or limiting the right that a chiropractor,
while acting within the scope of his or her license, may have to
prescribe a                                              device.
  SEC. 10.  Section 4076 of the Business and Professions Code is
amended to read:
   4076.  (a) A pharmacist shall not dispense any prescription except
in a container that meets the requirements of state and federal law
and is correctly labeled with all of the following:
   (1) Except where the prescriber or the certified nurse-midwife who
functions pursuant to a standardized procedure or protocol described
in Section 2746.51, the nurse practitioner who functions pursuant to
a standardized procedure described in Section 2836.1 or protocol,
the physician assistant who functions pursuant to Section 3502.1, the
naturopathic doctor who functions pursuant to a standardized
procedure or protocol described in Section 3640.5, or the pharmacist
who functions pursuant to a policy, procedure, or protocol pursuant
to either Section 4052.1 or 4052.2 orders otherwise, either the
manufacturer's trade name of the drug or the generic name and the
name of the manufacturer. Commonly used abbreviations may be used.
Preparations containing two or more active ingredients may be
identified by the manufacturer's trade name or the commonly used name
or the principal active ingredients.
   (2) The directions for the use of the drug.
   (3) The name of the patient or patients.
   (4) The name of the prescriber or, if applicable, the name of the
certified nurse-midwife who functions pursuant to a standardized
procedure or protocol described in Section 2746.51, the nurse
practitioner who functions pursuant to a standardized procedure
described in Section 2836.1 or protocol, the physician assistant who
functions pursuant to Section 3502.1, the naturopathic doctor who
functions pursuant to a standardized procedure or protocol described
in Section 3640.5, or the pharmacist who functions pursuant to a
policy, procedure, or protocol pursuant to either Section 4052.1 or
4052.2.
   (5) The date of issue.
   (6) The name and address of the pharmacy, and prescription number
or other means of identifying the prescription.
   (7) The strength of the drug or drugs dispensed.
   (8) The quantity of the drug or drugs dispensed.
   (9) The expiration date of the effectiveness of the drug
dispensed.
   (10) The condition or purpose for which the drug was prescribed if
the condition or purpose is indicated on the prescription.
   (11) (A) Commencing January 1, 2006, the physical description of
the dispensed medication, including its color, shape, and any
identification code that appears on the tablets or capsules, except
as follows:
   (i) Prescriptions dispensed by a veterinarian.
   (ii) An exemption from the requirements of this paragraph shall be
granted to a new drug for the first 120 days that the drug is on the
market and for the 90 days during which the national reference file
has no description on file.
   (iii) Dispensed medications for which no physical description
exists in any commercially available database.
   (B) This paragraph applies to outpatient pharmacies only.
   (C) The information required by this paragraph may be printed on
an auxiliary label that is affixed to the prescription container.
   (D) This paragraph shall not become operative if the board, prior
to January 1, 2006, adopts regulations that mandate the same labeling
requirements set forth in this paragraph.
   (b) If a pharmacist dispenses a prescribed drug by means of a unit
dose medication system, as defined by administrative regulation, for
a patient in a skilled nursing, intermediate care, or other health
care facility, the requirements of this section will be satisfied if
the unit dose medication system contains the aforementioned
information or the information is otherwise readily available at the
time of drug administration.
   (c) If a pharmacist dispenses a dangerous drug or device in a
facility licensed pursuant to Section 1250 of the Health and Safety
Code, it is not necessary to include on individual unit dose
containers for a specific patient, the name of the certified
nurse-midwife who functions pursuant to a standardized procedure or
protocol described in Section 2746.51, the nurse practitioner who
functions pursuant to a standardized procedure described in Section
2836.1 or protocol, the physician assistant who functions pursuant to
Section 3502.1, the naturopathic doctor who functions pursuant to a
standardized procedure or protocol described in Section 3640.5, or
the pharmacist who functions pursuant to a policy, procedure, or
protocol pursuant to either Section 4052.1 or 4052.2.
   (d) If a pharmacist dispenses a prescription drug for use in a
facility licensed pursuant to Section 1250 of the Health and Safety
Code, it is not necessary to include the information required in
paragraph (11) of subdivision (a) when the prescription drug is
administered to a patient by a person licensed under the Medical
Practice Act (Chapter 5 (commencing with Section 2000)), the Nursing
Practice Act (Chapter 6 (commencing with Section 2700)), or the
Vocational Nursing Practice Act (Chapter 6.5 (commencing with Section
2840)), who is acting within his or her scope of practice.
  SEC. 11.  Section 4980.44 of the Business and Professions Code is
amended to read:
   4980.44.  An unlicensed marriage and family therapist intern
employed under this chapter shall comply with the following
requirements:
   (a) Possess, at a minimum, a master's degree as specified in
Section 4980.36 or 4980.37, as applicable.
   (b) Register with the board prior to performing any duties, except
as otherwise provided in subdivision (g) of Section 4980.43.
   (c) Inform each client or patient prior to performing any
professional services that he or she is unlicensed and under the
supervision of a licensed marriage and family therapist, licensed
clinical social worker, licensed psychologist, or a licensed
physician and surgeon certified in psychiatry by the American Board
of Psychiatry and Neurology.
  SEC. 12.  Section 4999.2 of the Business and Professions Code is
amended to read:
   4999.2.  (a) In order to obtain and maintain a registration,
in-state or out-of-state telephone medical advice services shall
comply with the requirements established by the department. Those
requirements shall include, but shall not be limited to, all of the
following:
   (1) (A) Ensuring that all staff who provide medical advice
services are appropriately licensed, certified, or registered as a
physician and surgeon pursuant to Chapter 5 (commencing with Section
2000) or the Osteopathic Initiative Act, as a dentist, dental
hygienist, dental hygienist in alternative practice, or dental
hygienist in extended functions pursuant to Chapter 4 (commencing
with Section 1600), as an occupational therapist pursuant to Chapter
5.6 (commencing with Section 2570), as a registered nurse pursuant to
Chapter 6 (commencing with Section 2700), as a psychologist pursuant
to Chapter 6.6 (commencing with Section 2900), as a marriage and
family therapist pursuant to Chapter 13 (commencing with Section
4980), as a licensed clinical social worker pursuant to Chapter 14
(commencing with Section 4991), as an optometrist pursuant to Chapter
7 (commencing with Section 3000), or as a chiropractor pursuant to
the Chiropractic Initiative Act, and operating consistent with the
laws governing their respective scopes of practice in the state
within which they provide telephone medical advice services, except
as provided in paragraph (2).
   (B) Ensuring that all staff who provide telephone medical advice
services from an out-of-state location are health care professionals,
as identified in subparagraph (A), who are licensed, registered, or
certified in the state within which they are providing the telephone
medical advice services and are operating consistent with the laws
governing their respective scopes of practice.
   (2) Ensuring that the telephone medical advice provided is
consistent with good professional practice.
   (3) Maintaining records of telephone medical advice services,
including records of complaints, provided to patients in California
for a period of at least five years.
   (4) Ensuring that no staff member uses a title or designation when
speaking to an enrollee or subscriber that may cause a reasonable
person to believe that the staff member is a licensed, certified, or
registered professional described in subparagraph (A) of paragraph
(1), unless the staff member is a licensed, certified, or registered
professional.
   (5) Complying with all directions and requests for information
made by the department.
   (b) To the extent permitted by Article VII of the California
Constitution, the department may contract with a private nonprofit
accrediting agency to evaluate the qualifications of applicants for
registration pursuant to this chapter and to make recommendations to
the department.
  SEC. 13.  Section 4999.7 of the Business and Professions Code is
amended to read:
   4999.7.  (a) This section does not limit, preclude, or otherwise
interfere with the practices of other persons licensed or otherwise
authorized to practice, under any other provision of this division,
telephone medical advice services consistent with the laws governing
their respective scopes of practice, or licensed under the
Osteopathic Initiative Act or the Chiropractic Initiative Act and
operating consistent with the laws governing their respective scopes
of practice.
   (b) For purposes of this chapter, "telephone medical advice" means
a telephonic communication between a patient and a health care
professional in which the health care professional's primary function
is to provide to the patient a telephonic response to the patient's
questions regarding his or her or a family member's medical care or
treatment. "Telephone medical advice" includes assessment,
evaluation, or advice provided to patients or their family members.
   (c) For purposes of this chapter, "health care professional" is a
staff person described in Section 4999.2 who provides medical advice
services and is appropriately licensed, certified, or registered as a
dentist, dental hygienist, dental hygienist in alternative practice,
or dental hygienist in extended functions pursuant to Chapter 4
(commencing with Section 1600), as a physician and surgeon pursuant
to Chapter 5 (commencing with Section 2000) or the Osteopathic
Initiative Act, as a registered nurse pursuant to Chapter 6
(commencing with Section 2700), as a psychologist pursuant to Chapter
6.6 (commencing with Section 2900), as an optometrist pursuant to
Chapter 7 (commencing with Section 3000), as a marriage and family
therapist pursuant to Chapter 13 (commencing with Section 4980), as a
licensed clinical social worker pursuant to Chapter 14 (commencing
with Section 4991), or as a chiropractor pursuant to the Chiropractic
Initiative Act, and who is operating consistent with the laws
governing his or her respective scopes of practice in the state in
which he or she provides telephone medical advice services.
  SEC. 14.  Section 6213 of the Business and Professions Code is
amended to read:
   6213.  As used in this article:
   (a) "Qualified legal services project" means either of the
following:
   (1) A nonprofit project incorporated and operated exclusively in
California that provides as its primary purpose and function legal
services without charge to indigent persons and that has quality
control procedures approved by the State Bar of California.
   (2) A program operated exclusively in California by a nonprofit
law school accredited by the State Bar of California that meets the
requirements of subparagraphs (A) and (B).
   (A) The program shall have operated for at least two years at a
cost of at least twenty thousand dollars ($20,000) per year as an
identifiable law school unit with a primary purpose and function of
providing legal services without charge to indigent persons.
   (B) The program shall have quality control procedures approved by
the State Bar of California.
   (b) "Qualified support center" means an incorporated nonprofit
legal services center that has as its primary purpose and function
the provision of legal training, legal technical assistance, or
advocacy support without charge and which actually provides through
an office in California a significant level of legal training, legal
technical assistance, or advocacy support without charge to qualified
legal services projects on a statewide basis in California.
   (c) "Recipient" means a qualified legal services project or
support center receiving financial assistance under this article.
   (d) "Indigent person" means a person whose income is (1) 125
percent or less of the current poverty threshold established by the
United States Office of Management and Budget, or (2) who is eligible
for Supplemental Security Income or free services under the Older
Americans Act or Developmentally Disabled Assistance Act. With regard
to a project that provides free services of attorneys in private
practice without compensation, "indigent person" also means a person
whose income is 75 percent or less of the maximum levels of income
for lower income households as defined in Section 50079.5 of the
Health and Safety Code. For the purpose of this subdivision, the
income of a person who is disabled shall be determined after
deducting the costs of medical and other disability-related special
expenses.
   (e) "Fee generating case" means a case or matter that, if
undertaken on behalf of an indigent person by an attorney in private
practice, reasonably may be expected to result in payment of a fee
for legal services from an award to a client, from public funds, or
from the opposing party. A case shall not be considered fee
generating if adequate representation is unavailable and any of the
following circumstances exist:
   (1) The recipient has determined that free referral is not
possible because of any of the following reasons:
   (A) The case has been rejected by the local lawyer referral
service, or if there is no such service, by two attorneys in private
practice who have experience in the subject matter of the case.
   (B) Neither the referral service nor any attorney will consider
the case without payment of a consultation fee.
   (C) The case is of the type that attorneys in private practice in
the area ordinarily do not accept, or do not accept without
prepayment of a fee.
   (D) Emergency circumstances compel immediate action before
referral can be made, but the client is advised that, if appropriate
and consistent with professional responsibility, referral will be
attempted at a later time.
   (2) Recovery of damages is not the principal object of the case
and a request for damages is merely ancillary to an action for
equitable or other nonpecuniary relief, or inclusion of a
counterclaim requesting damages is necessary for effective defense or
because of applicable rules governing joinder of counterclaims.
   (3) A court has appointed a recipient or an employee of a
recipient pursuant to a statute or a court rule or practice of equal
applicability to all attorneys in the jurisdiction.
   (4) The case involves the rights of a claimant under a publicly
supported benefit program for which entitlement to benefit is based
on need.
   (f) "Legal Services Corporation" means the Legal Services
Corporation established under the Legal Services Corporation Act of
1974 (P.L. 93-355; 42 U.S.C. Sec. 2996 et seq.).
   (g) "Older Americans Act" means the Older Americans Act of 1965,
as amended (P.L. 89-73; 42 U.S.C. Sec. 3001 et seq.).
   (h) "Developmentally Disabled Assistance Act" means the
Developmentally Disabled Assistance and Bill of Rights Act, as
amended (P.L. 94-103; 42 U.S.C. Sec. 6001 et seq.).
   (i) "Supplemental security income recipient" means an individual
receiving or eligible to receive payments under Title XVI of the
federal Social Security Act, or payments under Chapter 3 (commencing
with Section 12000) of Part 3 of Division 9 of the Welfare and
Institutions Code.
   (j) "IOLTA account" means an account or investment product
established and maintained pursuant to subdivision (a) of Section
6211 that is any of the following:
   (1) An interest-bearing checking account.
   (2) An investment sweep product that is a daily (overnight)
financial institution repurchase agreement or an open-end money
market fund.
   (3) An investment product authorized by California Supreme Court
rule or order.
   A daily financial institution repurchase agreement shall be fully
collateralized by United States Government Securities or other
comparably conservative debt securities, and may be established only
with any eligible institution that is "well-capitalized" or
"adequately capitalized" as those terms are defined by applicable
federal statutes and regulations. An open-end money market fund shall
be invested solely in United States Government Securities or
repurchase agreements fully collateralized by United States
Government Securities or other comparably conservative debt
securities, shall hold itself out as a "money market fund" as that
term is defined by federal statutes and regulations under the
Investment Company Act of 1940 (15 U.S.C. Sec. 80a-1 et seq.), and,
at the time of the investment, shall have total assets of at least
two hundred fifty million dollars ($250,000,000).
   (k) "Eligible institution" means either of the following:
   (1) A bank, savings and loan, or other financial institution
regulated by a federal or state agency that pays interest or
dividends in the IOLTA account and carries deposit insurance from an
agency of the federal government.
   (2) Any other type of financial institution authorized by the
California Supreme Court.
  SEC. 15.  Section 7028 of the Business and Professions Code is
amended to read:
   7028.  (a) It is a misdemeanor for a person to engage in the
business or act in the capacity of a contractor within this state
without having a license therefor, unless the person is particularly
exempted from the provisions of this chapter.
   (b) A first conviction for the offense described in this section
is punishable by a fine not exceeding five thousand dollars ($5,000)
or by imprisonment in a county jail not exceeding six months, or by
both that fine and imprisonment.
   (c) If a person has been previously convicted of the offense
described in this section, unless the provisions of subdivision (d)
are applicable, the court shall impose a fine of 20 percent of the
contract price, or 20 percent of the aggregate payments made to, or
at the direction of, the unlicensed contractor, or five thousand
dollars ($5,000), whichever is greater, and, unless the sentence
prescribed in subdivision (d) is imposed, the person shall be
confined in a county jail for not less than 90 days, except in an
unusual case where the interests of justice would be served by
imposition of a lesser sentence or a fine. If the court imposes only
a fine or a jail sentence of less than 90 days for second or
subsequent convictions under this section, the court shall state the
reasons for its sentencing choice on the record.
   (d) A third or subsequent conviction for the offense described in
this section is punishable by a fine of not less than five thousand
dollars ($5,000) nor more than the greater amount of ten thousand
dollars ($10,000) or 20 percent of the contract price, or 20 percent
of the aggregate payments made to, or at the direction of, the
unlicensed contractor, and by imprisonment in a county jail for not
more than one year or less than 90 days. The penalty provided by this
subdivision is cumulative to the penalties available under all other
laws of this state.
   (e) A person who violates this section is subject to the penalties
prescribed in subdivision (d) if the person was named on a license
that was previously revoked and, either in fact or under law, was
held responsible for any act or omission resulting in the revocation.

   (f) If the person engaging in the business of or acting in the
capacity of an unlicensed contractor has agreed to furnish materials
and labor on an hourly basis, "the contract price" for the purposes
of this section means the aggregate sum of the cost of materials and
labor furnished and the cost of completing the work to be performed.
   (g) Notwithstanding any other provision of law, an indictment for
any violation of this section by the unlicensed contractor shall be
found or an information or complaint filed within four years from the
date of the contract proposal, contract, completion, or abandonment
of the work, whichever occurs last.
   (h) For any conviction under this section, a person who utilized
the services of the unlicensed contractor is a victim of crime and is
eligible, pursuant to subdivision (f) of Section 1202.4 of the Penal
Code, for restitution for economic losses, regardless of whether
that person had knowledge that the contractor was unlicensed.
  SEC. 16.  Section 7108.5 of the Business and Professions Code is
amended to read:
   7108.5.  (a) This section applies to all private works of
improvement and to all public works of improvement, except where
Section 10262 of the Public Contract Code applies.
   (b) Except as provided in subdivision (c), a prime contractor or
subcontractor shall pay to any subcontractor, not later than 10 days
after receipt of each progress payment, unless otherwise agreed to in
writing, the respective amounts allowed the contractor on account of
the work performed by the subcontractors, to the extent of each
subcontractor's interest therein. A prime contractor or subcontractor
that fails to comply with this subdivision shall be subject to a
penalty, payable to the subcontractor, of 2 percent of the amount due
per month for every month that payment is not made as required under
this subdivision.
   (c) If there is a good faith dispute over all or any portion of
the amount due on a progress payment from the prime contractor or
subcontractor to a subcontractor, the prime contractor or
subcontractor may withhold no more than 150 percent of the disputed
amount.
   (d) A violation of this section shall constitute a cause for
disciplinary action.
   (e) In any action for the collection of funds wrongfully withheld,
the prevailing party shall be entitled to his or her attorney's fees
and costs.
   (f) The sanctions authorized under this section shall be separate
from, and in addition to, all other remedies, either civil,
administrative, or criminal.
  SEC. 17.  Section 8520.2 of the Business and Professions Code is
amended to read:
   8520.2.  (a) The Structural Pest Control Board is hereby
transferred from the jurisdiction of the Department of Consumer
Affairs and placed under the jurisdiction of the Department of
Pesticide Regulation.
   (b) The registrar of the board under the jurisdiction of the
Department of Consumer Affairs shall remain as the registrar of the
board under the jurisdiction of the Department of Pesticide
Regulation.
   (c) The members appointed to the board while under the
jurisdiction of the Department of Consumer Affairs shall remain as
members of the board under the jurisdiction of the Department of
Pesticide Regulation.
   (d) All employees of the board under the jurisdiction of the
Department of Consumer Affairs are hereby transferred to the board
under the jurisdiction of the Department of Pesticide Regulation.
   (e) The duties, powers, purposes, responsibilities, and
jurisdictions of the board under the jurisdiction of the Department
of Consumer Affairs shall remain with the board under the
jurisdiction of the Department of Pesticide Regulation.
   (f) For the performance of the duties and the exercise of the
powers vested in the board under this chapter, the board shall have
possession and control of all records, papers, offices, equipment,
supplies, or other property, real or personal, held for the benefit
or use by the board formerly within the jurisdiction of the
Department of Consumer Affairs.
   (g) Any reference to the board in this chapter or in any other
provision of law or regulation shall be construed as a reference to
the board under the jurisdiction of the Department of Pesticide
Regulation.
  SEC. 18.  Section 8676 of the Business and Professions Code is
amended to read:
   8676.  The Department of Pesticide Regulation shall receive and
account for all moneys collected under this chapter at the end of
each month, and shall pay it into the Treasury to the credit of the
Structural Pest Control Fund, which is hereby continued in existence.

   The moneys in this fund shall be expended for the pro rata cost of
administration of the Department of Pesticide Regulation and for the
purpose of carrying out the provisions of this chapter.
  SEC. 19.  Section 8761 of the Business and Professions Code is
amended to read:
   8761.  (a) Any licensed land surveyor or civil engineer authorized
to practice land surveying may practice land surveying and prepare
maps, plats, reports, descriptions, or other documentary evidence in
connection with that practice.
   (b) All maps, plats, reports, descriptions, or other land
surveying documents shall be prepared by, or under the responsible
charge of, a licensed land surveyor or civil engineer authorized to
practice land surveying and shall include his or her name and license
number.
   (c) Interim maps, plats, reports, descriptions, or other land
surveying documents shall include a notation as to the intended
purpose of the map, plat, report, description, or other document,
such as "preliminary" or "for examination only."
   (d) All final maps, plats, reports, descriptions, or other land
surveying documents issued by a licensed land surveyor or civil
engineer authorized to practice land surveying shall bear the
signature and seal or stamp of the licensee and the date of signing
and sealing or stamping. If the land surveying document has multiple
pages or sheets, the signature, seal or stamp, and date of signing
and sealing or stamping shall appear, at a minimum, on the title
sheet, cover sheet or page, or signature sheet, unless otherwise
required by law.
   (e) It is unlawful for any person to sign, stamp, seal, or approve
any map, plat, report, description, or other land surveying document
unless the person is authorized to practice land surveying.
   (f) It is unlawful for any person to stamp or seal any map, plat,
report, description, or other land surveying document with the seal
or stamp after the certificate of the licensee that is named on the
seal or stamp has expired or has been suspended or revoked, unless
the certificate has been renewed or reissued.
  SEC. 20.  Section 9889.20 of the Business and Professions Code is
amended to read:
   9889.20.  Except as otherwise provided in Section 9889.21, any
person who fails to comply in any respect with the provisions of this
                                           chapter is guilty of a
misdemeanor and punishable by a fine not exceeding one thousand
dollars ($1,000), or by imprisonment not exceeding six months, or by
both that fine and imprisonment.
  SEC. 21.  Section 11344 of the Business and Professions Code is
amended to read:
   11344.  (a) Notwithstanding Section 11341, a temporary license may
be issued pending the outcome of the fingerprint and background
check or as otherwise prescribed by the director. A temporary license
is valid for up to 150 days. Unless otherwise prohibited pursuant to
Section 17520 of the Family Code, a temporary license may be renewed
once at the discretion of the director.
   (b) The director may issue a probationary license as follows:
   (1) By term.
   (2) By conditions to be observed in the exercise of the privileges
granted.
  SEC. 22.  Section 19596.2 of the Business and Professions Code is
amended to read:
   19596.2.  (a) Notwithstanding any other provision of law and
except as provided in Section 19596.4, a thoroughbred racing
association or fair may distribute the audiovisual signal and accept
wagers on the results of out-of-state thoroughbred races conducted in
the United States during the calendar period the association or fair
is conducting a race meeting, including days on which there is no
live racing being conducted by the association or fair, without the
consent of the organization that represents horsemen and horsewomen
participating in the race meeting and without regard to the amount of
purses. Further, the total number of thoroughbred races imported by
associations or fairs on a statewide basis under this section shall
not exceed 32 per day on days when live thoroughbred or fair racing
is being conducted in the state. The limitation of 32 imported races
per day does not apply to any of the following:
   (1) Races imported for wagering purposes pursuant to subdivision
(c).
   (2) Races imported that are part of the race card of the Kentucky
Derby, the Kentucky Oaks, the Preakness Stakes, the Belmont Stakes,
the Jockey Club Gold Cup, the Travers Stakes, the Breeders' Cup, the
Dubai Cup, or the Haskell Invitational.
   (3) Races imported into the northern zone when there is no live
thoroughbred or fair racing being conducted in the northern zone.
   (4) Races imported into the combined central and southern zones
when there is no live thoroughbred or fair racing being conducted in
the combined central and southern zones.
   (b) A thoroughbred association or fair accepting wagers pursuant
to subdivision (a) shall conduct the wagering in accordance with the
applicable provisions of Sections 19601, 19616, 19616.1, and 19616.2.

   (c) No thoroughbred association or fair may accept wagers pursuant
to this section on out-of-state races commencing after 7 p.m.,
Pacific standard time, without the consent of the harness or quarter
horse racing association that is then conducting a live racing
meeting in Orange or Sacramento County.
  SEC. 23.  Section 19605.10 of the Business and Professions Code is
amended and renumbered to read:
   19605.79.  (a) Notwithstanding any other provision of law, in the
event there are at any time uncommitted surplus funds in accounts
created pursuant to Sections 19605.73 and 19605.75, those unexpended
funds may, at the written request of the organization governing those
funds and with the approval of the board, be reallocated to any
other fund or account created pursuant to this chapter.
   (b) Requests to the board to reallocate funds pursuant to
subdivision (a) shall be accompanied by a report detailing all
receipts and expenditures over the two prior fiscal years of the
funds affected by the request.
   (c) Initial board approval of a request to reallocate funds
pursuant to subdivision (a) shall be limited to a one-year period.
Approval of a reallocation may be extended beyond one year upon a
determination by the board that the extension is in the economic
interest of thoroughbred racing.
   (d) The organization whose written request pursuant to subdivision
(a) has been approved by the board shall provide subsequent
quarterly reports of receipts and expenditures of the affected funds
if requested by the board.
   (e) The organization whose written request pursuant to subdivision
(a) has been approved by the board shall file a report with the
board and the respective fiscal committees and committees on
governmental organization of the Senate and the Assembly accounting
for all receipts and expenditures in any of the affected funds. This
report shall be filed within one year of initial board approval and
annually thereafter if the approval is extended by the board.
  SEC. 24.  Section 19850.6 of the Business and Professions Code is
amended to read:
   19850.6.  (a) In order to avoid delays in implementing the
California Remote Caller Bingo Act, including implementing remote
caller bingo, testing and certifying card-minding devices, and to
avoid disruption of fundraising efforts by nonprofit organizations,
the Legislature finds and declares that it is necessary to provide
the commission with a limited exemption from normal rulemaking
procedural requirements. The commission is directed to adopt
appropriate emergency regulations as soon as possible, the initial
regulatory action to be filed with the Office of Administrative Law
no later than May 1, 2009. It is the intent of the Legislature to
provide the commission with full authority and sufficient flexibility
to adopt all needed regulations. These regulations may be adopted in
a series of regulatory actions. Subsequent regulatory actions may
amend or repeal earlier regulatory actions, as necessary, to reflect
program experience and concerns of the regulated public.
   (b) The commission shall adopt emergency regulations concerning
remote caller bingo and concerning card-minding devices no later than
May 1, 2009. The adoption, amendment, repeal, or readoption of a
regulation authorized by this section is deemed to address an
emergency, for purposes of Sections 11346.1 and 11349.6 of the
Government Code, and the commission is hereby exempted for this
purpose from the requirements of subdivision (b) of Section 11346.1
of the Government Code, but shall otherwise be subject to the review
and approval of the Office of Administrative Law.
   (c) Notwithstanding any other law, all emergency regulations
adopted by the commission pursuant to this section before July 1,
2009, shall remain in effect until December 31, 2011, except to the
extent that the commission exercises its power to adopt, amend, or
repeal these regulations in whole or in part.
  SEC. 25.  Section 23356.2 of the Business and Professions Code is
amended to read:
   23356.2.  (a) No license or permit shall be required for the
manufacture of beer for personal or family use, and not for sale, by
a person over 21 years of age. The aggregate amount of beer with
respect to any household shall not exceed (1) 200 gallons per
calendar year if there are two or more adults in the household or (2)
100 gallons per calendar year if there is only one adult in the
household.
   (b) No license or permit shall be required for the manufacture of
wine for personal or family use, and not for sale, by a person over
21 years of age. The aggregate amount of wine with respect to any
household shall not exceed (1) 200 gallons per calendar year if there
are two or more adults in the household or (2) 100 gallons per
calendar year if there is only one adult in the household.
   (c) Any beer manufactured pursuant to this section may be removed
from the premises where manufactured for use in competition at
organized affairs, exhibitions, or competitions, including homemakers'
contests, tastings, or judgings.
   (d) Any wine made pursuant to this section may be removed from the
premises where made for personal or family use, including use at
organized affairs, exhibitions, or competitions, such as homemakers'
contests, tastings, or judgings. Wine used under this section shall
not be sold or offered for sale.
   (e) Except as provided herein, nothing in this section authorizes
any activity in violation of Section 23300, 23355, or 23399.1.
  SEC. 26.  Section 25503.42 of the Business and Professions Code is
amended to read:
   25503.42.  (a) Notwithstanding any other provision of this
chapter, a beer manufacturer, the holder of a winegrower's license, a
California winegrower's agent, a holder of a distilled spirits
rectifier's general license, a distilled spirits manufacturer, or a
distilled spirits manufacturer's agent may purchase indoor
advertising space or time at a fully enclosed venue with box office
sales and attendance by the public on a ticketed basis only, with a
patronage capacity in excess of 2,000, located in Los Angeles County
within the area subject to the Los Angeles Sports and Entertainment
District Specific Plan adopted by the City of Los Angeles pursuant to
ordinance number 174225, as approved on September 6, 2001, where the
owner of the venue is not the on-sale retail licensee. The purchase
of the indoor advertising space or time shall be subject to all of
the following conditions:
   (1) The indoor advertising space or time is purchased only at the
venue specified in this subdivision.
   (2) The purchase of indoor advertising space or time shall be
conducted pursuant to a written agreement entered into by the beer
manufacturer, holder of a winegrower's license, California winegrower'
s agent, holder of a distilled spirits rectifier's general license,
distilled spirits manufacturer, or a distilled spirits manufacturer's
agent and the owner of the venue described in this subdivision. A
holder of a wholesale license shall not be a party to the written
agreement or otherwise have any direct or indirect obligations under
the agreement, including an obligation to share in the costs or
contribute to the costs of the indoor advertising space or time
purchased pursuant to this section.
   (3) An agreement for the purchase of indoor advertising space or
time pursuant to this section shall not be conditioned directly or
indirectly, in any way, on the purchase, sale, or distribution of any
alcoholic beverage manufactured or distributed by the advertising
beer manufacturer, holder of a winegrower's license, California
winegrower's agent, holder of a distilled spirits rectifier's general
license, distilled spirits manufacturer, or a distilled spirits
manufacturer's agent by any on-sale retail licensee.
   (4) An on-sale licensee operating at a venue described in this
subdivision where indoor advertising space or time is purchased shall
serve other brands of beer distributed by a competing beer
wholesaler in addition to the brands manufactured or marketed by the
advertising beer manufacturer, other brands of wine distributed by a
competing wine wholesaler in addition to the brands produced or
marketed by the advertising winegrower or California winegrower's
agent, and other brands of distilled spirits distributed by a
competing distilled spirits wholesaler in addition to the brands
manufactured or marketed by the advertising distilled spirits
manufacturer, the distilled spirits manufacturer's agent, or a holder
of a distilled spirits rectifier's general license.
   (5) No more than 15 percent of the retail licensee's purchases of
distilled spirits and wine for sale on its licensed premises shall be
manufactured, produced, or distributed by the holder of a winegrower'
s license, California winegrower's agent, distilled spirits
manufacturer, holder of a distilled spirits rectifier's general
license, or a distilled spirits manufacturer's agent that has
purchased indoor advertising space.
   (b) A beer manufacturer, holder of a winegrower's license,
California winegrower's agent, holder of a distilled spirits
rectifier's general license, distilled spirits manufacturer, or a
distilled spirits manufacturer's agent who, through coercion or other
illegal means, induces, directly or indirectly, a holder of a
wholesaler's license to fulfill those contractual obligations entered
into pursuant to subdivision (a) shall be guilty of a misdemeanor
and shall be punished by imprisonment in a county jail for not more
than six months, or by a fine equal to the greater of an amount equal
to the entire value of the advertising space or time involved in the
contract or ten thousand dollars ($10,000), or by both that
imprisonment and fine. The person shall also be subject to license
revocation pursuant to Section 24200.
   (c) An on-sale retail licensee who, directly or indirectly,
solicits or coerces a holder of a wholesaler's license to solicit a
beer manufacturer, holder of a winegrower's license, California
winegrower's agent, holder of a distilled spirits rectifier's general
license, distilled spirits manufacturer, or a distilled spirits
manufacturer's agent to purchase indoor advertising time or space
pursuant to subdivision (a) shall be guilty of a misdemeanor and
shall be punished by imprisonment in a county jail for not more than
six months, or by a fine equal to the greater of an amount equal to
the entire value of the advertising space or time involved in the
contract or ten thousand dollars ($10,000), or by both that
imprisonment and fine. The person shall also be subject to license
revocation pursuant to Section 24200.
   (d) For purposes of this section, "beer manufacturer" includes a
holder of a beer manufacturer's license, a holder of an out-of-state
beer manufacturer's certificate, or a holder of a beer and wine
importer's general license.
   (e) Nothing in this section shall authorize the purchasing of
indoor advertising space or time pursuant to subdivision (a) by any
beer manufacturer, holder of a winegrower's license, a California
winegrower's agent, a distilled spirits manufacturer, holder of a
distilled spirits rectifier's general license, or a distilled spirits
manufacturer's agent directly or indirectly from any on-sale
licensee.
   (f) A venue owner that meets the description provided in
subdivision (a) and that enters into a written agreement pursuant to
this section shall obtain an annual certificate from the department.
The director shall prepare, as part of the annual report required by
Section 23055 for submission to the Legislature, a listing of the
number of certifications made pursuant to this section or the absence
of any certifications. Where there have been no certifications made
pursuant to this section for two consecutive years, this information
shall be included in the report.
   (g) The Legislature finds that it is necessary and proper to
require a separation among manufacturing interests, wholesale
interests, and retail interests in the production and distribution of
alcoholic beverages in order to prevent suppliers from dominating
local markets through vertical integration and to prevent excessive
sales of alcoholic beverages produced by overly aggressive marketing
techniques. The Legislature further finds that the exception
established by this section to the general prohibition against tied
interests shall be limited to its express terms so as not to
undermine the general prohibition, and intends that this section be
construed accordingly.
  SEC. 27.  Section 25658.4 of the Business and Professions Code is
amended to read:
   25658.4.  (a) No clerk shall make an off sale of alcoholic
beverages unless the clerk executes under penalty of perjury on the
first day he or she makes that sale an application and
acknowledgment. The application and acknowledgment shall be in a form
understandable to the clerk.
   (1) The department shall specify the form of the application and
acknowledgment, which shall include at a minimum a summary of this
division pertaining to the following:
   (A) The prohibitions contained in Sections 25658 and 25658.5
pertaining to the sale to, and purchase of, alcoholic beverages by
persons under 21 years of age.
   (B) Bona fide evidence of majority as provided in Section 25660.
   (C) Hours of operation as provided in Article 2 (commencing with
Section 25631).
   (D) The prohibitions contained in subdivision (a) of Section 25602
and Section 25602.1 pertaining to sales to an intoxicated person.
   (E) Sections 23393 and 23394 as they pertain to on-premises
consumption of alcoholic beverages in an off-sale premises.
   (F) The requirements and prohibitions contained in Section 25659.5
pertaining to sales of keg beer for consumption off licensed
premises.
   (2) The application and acknowledgment shall also include a
statement that the clerk has read and understands the summary, a
statement that the clerk has never been convicted of violating this
division or, if convicted, an explanation of the circumstances of
each conviction, and a statement that the application and
acknowledgment is executed under penalty of perjury.
   (3) The licensee shall keep the executed application and
acknowledgment on the premises at all times and available for
inspection by the department. A licensee with more than one licensed
off-sale premises in the state may comply with this subdivision by
maintaining an executed application and acknowledgment at a
designated licensed premises, regional office, or headquarters office
in the state. An executed application and acknowledgment maintained
at the designated locations shall be valid for all licensed off-sale
premises owned by the licensee. Any licensee maintaining an
application and acknowledgment at a designated site other than the
individual licensed off-sale premises shall notify the department in
advance and in writing of the site where the application and
acknowledgment shall be maintained and available for inspection. A
licensee electing to maintain an application and acknowledgments at a
designated site other than the licensed premises shall maintain at
each licensed premises a notice of where the executed application and
acknowledgments are located. Any licensee with more than one
licensed off-sale premises who elects to maintain the application and
acknowledgments at a designated site other than each licensed
premises shall provide the department, upon written demand, a copy of
any employee's executed application and acknowledgment within 10
business days. A violation of this subdivision by a licensee
constitutes grounds for discipline by the department.
   (b) The licensee shall post a notice that contains and describes,
in concise terms, prohibited sales of alcoholic beverages, a
statement that the off-sale seller will refuse to make a sale if the
seller reasonably suspects that the Alcoholic Beverage Control Act
may be violated, and a statement that a minor who purchases or
attempts to purchase alcoholic beverages is subject to suspension or
delay in the issuance of his or her driver's license pursuant to
Section 13202.5 of the Vehicle Code. The notice shall be posted at an
entrance or at a point of sale in the licensed premises or in any
other location that is visible to purchasers of alcoholic beverages
and to the off-sale seller.
   (c) A retail licensee shall post a notice that contains and
describes, in concise terms, the fines and penalties for any
violation of Section 25658, relating to the sale of alcoholic
beverages to, or the purchase of alcoholic beverages by, any person
under 21 years of age.
   (d) Nonprofit organizations or licensees may obtain video
recordings and other training materials from the department on the
Licensee Education on Alcohol and Drugs (LEAD) program. The video
recordings and training materials may be updated periodically and may
be provided in English and other languages, and when made available
by the department, shall be provided at cost.
   (e) As used in this section:
   (1) "Off-sale seller" means any person holding a retail off-sale
license issued by the department and any person employed by that
licensee who in the course of that employment sells alcoholic
beverages.
   (2) "Clerk" means an off-sale seller who is not a licensee.
   (f) The department may adopt rules and appropriate fees for
licensees that it determines necessary for the administration of this
section.
  SEC. 28.  Section 1185 of the Civil Code is amended to read:
   1185.  (a) The acknowledgment of an instrument shall not be taken
unless the officer taking it has satisfactory evidence that the
person making the acknowledgment is the individual who is described
in and who executed the instrument.
   (b) For purposes of this section "satisfactory evidence" means the
absence of information, evidence, or other circumstances that would
lead a reasonable person to believe that the person making the
acknowledgment is not the individual he or she claims to be and any
one of the following:
   (1) (A) The oath or affirmation of a credible witness personally
known to the officer, whose identity is proven to the officer upon
presentation of a document satisfying the requirements of paragraph
(3) or (4), that the person making the acknowledgment is personally
known to the witness and that each of the following are true:
   (i) The person making the acknowledgment is the person named in
the document.
   (ii) The person making the acknowledgment is personally known to
the witness.
   (iii) That it is the reasonable belief of the witness that the
circumstances of the person making the acknowledgment are such that
it would be very difficult or impossible for that person to obtain
another form of identification.
   (iv) The person making the acknowledgment does not possess any of
the identification documents named in paragraphs (3) and (4).
   (v) The witness does not have a financial interest in the document
being acknowledged and is not named in the document.
   (B) A notary public who violates this section by failing to obtain
the satisfactory evidence required by subparagraph (A) shall be
subject to a civil penalty not exceeding ten thousand dollars
($10,000). An action to impose this civil penalty may be brought by
the Secretary of State in an administrative proceeding or a public
prosecutor in superior court, and shall be enforced as a civil
judgment. A public prosecutor shall inform the secretary of any civil
penalty imposed under this subparagraph.
   (2) The oath or affirmation under penalty of perjury of two
credible witnesses, whose identities are proven to the officer upon
the presentation of a document satisfying the requirements of
paragraph (3) or (4), that each statement in paragraph (1) is true.
   (3) Reasonable reliance on the presentation to the officer of any
one of the following, if the document is current or has been issued
within five years:
   (A) An identification card or driver's license issued by the
Department of Motor Vehicles.
   (B) A passport issued by the Department of State of the United
States.
   (4) Reasonable reliance on the presentation of any one of the
following, provided that a document specified in subparagraphs (A) to
(F), inclusive, shall either be current or have been issued within
five years and shall contain a photograph and description of the
person named on it, shall be signed by the person, shall bear a
serial or other identifying number, and, in the event that the
document is a passport, shall have been stamped by the United States
Citizenship and Immigration Services of the Department of Homeland
Security:
   (A) A passport issued by a foreign government.
   (B) A driver's license issued by a state other than California or
by a Canadian or Mexican public agency authorized to issue driver's
licenses.
   (C) An identification card issued by a state other than
California.
   (D) An identification card issued by any branch of the Armed
Forces of the United States.
   (E) An inmate identification card issued on or after January 1,
1988, by the Department of Corrections and Rehabilitation, if the
inmate is in custody.
   (F) An employee identification card issued by an agency or office
of the State of California, or by an agency or office of a city,
county, or city and county in this state.
   (G) An inmate identification card issued prior to January 1, 1988,
by the Department of Corrections and Rehabilitation, if the inmate
is in custody.
   (c) An officer who has taken an acknowledgment pursuant to this
section shall be presumed to have operated in accordance with the
provisions of law.
   (d) A party who files an action for damages based on the failure
of the officer to establish the proper identity of the person making
the acknowledgment shall have the burden of proof in establishing the
negligence or misconduct of the officer.
   (e) A person convicted of perjury under this section shall forfeit
any financial interest in the document.
  SEC. 29.  Section 1363.03 of the Civil Code is amended to read:
   1363.03.  (a) An association shall adopt rules, in accordance with
the procedures prescribed by Article 4 (commencing with Section
1357.100) of Chapter 2, that do all of the following:
   (1) Ensure that if any candidate or member advocating a point of
view is provided access to association media, newsletters, or
Internet Web sites during a campaign, for purposes that are
reasonably related to that election, equal access shall be provided
to all candidates and members advocating a point of view, including
those not endorsed by the board, for purposes that are reasonably
related to the election. The association shall not edit or redact any
content from these communications, but may include a statement
specifying that the candidate or member, and not the association, is
responsible for that content.
   (2) Ensure access to the common area meeting space, if any exists,
during a campaign, at no cost, to all candidates, including those
who are not incumbents, and to all members advocating a point of
view, including those not endorsed by the board, for purposes
reasonably related to the election.
   (3) Specify the qualifications for candidates for the board of
directors and any other elected position, and procedures for the
nomination of candidates, consistent with the governing documents. A
nomination or election procedure shall not be deemed reasonable if it
disallows any member of the association from nominating himself or
herself for election to the board of directors.
   (4) Specify the qualifications for voting, the voting power of
each membership, the authenticity, validity, and effect of proxies,
and the voting period for elections, including the times at which
polls will open and close, consistent with the governing documents.
   (5) Specify a method of selecting one or three independent third
parties as inspector or inspectors of elections utilizing one of the
following methods:
   (A) Appointment of the inspector or inspectors by the board.
        (B) Election of the inspector or inspectors by the members of
the association.
   (C) Any other method for selecting the inspector or inspectors.
   (6) Allow the inspector or inspectors to appoint and oversee
additional persons to verify signatures and to count and tabulate
votes as the inspector or inspectors deem appropriate, provided that
the persons are independent third parties.
   (b) Notwithstanding any other law or provision of the governing
documents, elections regarding assessments legally requiring a vote,
election and removal of members of the association board of
directors, amendments to the governing documents, or the grant of
exclusive use of common area property pursuant to Section 1363.07
shall be held by secret ballot in accordance with the procedures set
forth in this section. A quorum shall be required only if so stated
in the governing documents of the association or other provisions of
law. If a quorum is required by the governing documents, each ballot
received by the inspector of elections shall be treated as a member
present at a meeting for purposes of establishing a quorum. An
association shall allow for cumulative voting using the secret ballot
procedures provided in this section, if cumulative voting is
provided for in the governing documents.
   (c) (1) The association shall select an independent third party or
parties as an inspector of elections. The number of inspectors of
elections shall be one or three.
   (2) For the purposes of this section, an independent third party
includes, but is not limited to, a volunteer poll worker with the
county registrar of voters, a licensee of the California Board of
Accountancy, or a notary public. An independent third party may be a
member of the association, but may not be a member of the board of
directors or a candidate for the board of directors or related to a
member of the board of directors or a candidate for the board of
directors. An independent third party may not be a person, business
entity, or subdivision of a business entity who is currently employed
or under contract to the association for any compensable services
unless expressly authorized by rules of the association adopted
pursuant to paragraph (5) of subdivision (a).
   (3) The inspector or inspectors of elections shall do all of the
following:
   (A) Determine the number of memberships entitled to vote and the
voting power of each.
   (B) Determine the authenticity, validity, and effect of proxies,
if any.
   (C) Receive ballots.
   (D) Hear and determine all challenges and questions in any way
arising out of or in connection with the right to vote.
   (E) Count and tabulate all votes.
   (F) Determine when the polls shall close, consistent with the
governing documents.
   (G) Determine the tabulated results of the election.
   (H) Perform any acts as may be proper to conduct the election with
fairness to all members in accordance with this section, the
Corporations Code, and all applicable rules of the association
regarding the conduct of the election that are not in conflict with
this section.
   (4) An inspector of elections shall perform his or her duties
impartially, in good faith, to the best of his or her ability, and as
expeditiously as is practical. If there are three inspectors of
elections, the decision or act of a majority shall be effective in
all respects as the decision or act of all. Any report made by the
inspector or inspectors of elections is prima facie evidence of the
facts stated in the report.
   (d) (1) For purposes of this section, the following definitions
shall apply:
   (A) "Proxy" means a written authorization signed by a member or
the authorized representative of the member that gives another member
or members the power to vote on behalf of that member.
   (B) "Signed" means the placing of the member's name on the proxy
(whether by manual signature, typewriting, telegraphic transmission,
or otherwise) by the member or authorized representative of the
member.
   (2) Proxies shall not be construed or used in lieu of a ballot. An
association may use proxies if permitted or required by the bylaws
of the association and if those proxies meet the requirements of this
article, other laws, and the association's governing documents, but
the association shall not be required to prepare or distribute
proxies pursuant to this section.
   (3) Any instruction given in a proxy issued for an election that
directs the manner in which the proxyholder is to cast the vote shall
be set forth on a separate page of the proxy that can be detached
and given to the proxyholder to retain. The proxyholder shall cast
the member's vote by secret ballot. The proxy may be revoked by the
member prior to the receipt of the ballot by the inspector of
elections as described in Section 7613 of the Corporations Code.
   (e) Ballots and two preaddressed envelopes with instructions on
how to return ballots shall be mailed by first-class mail or
delivered by the association to every member not less than 30 days
prior to the deadline for voting. In order to preserve
confidentiality, a voter may not be identified by name, address, or
lot, parcel, or unit number on the ballot. The association shall use
as a model those procedures used by California counties for ensuring
confidentiality of vote by mail ballots, including all of the
following:
   (1) The ballot itself is not signed by the voter, but is inserted
into an envelope that is sealed. This envelope is inserted into a
second envelope that is sealed. In the upper left-hand corner of the
second envelope, the voter shall sign his or her name, indicate his
or her name, and indicate the address or separate interest identifier
that entitles him or her to vote.
   (2) The second envelope is addressed to the inspector or
inspectors of elections, who will be tallying the votes. The envelope
may be mailed or delivered by hand to a location specified by the
inspector or inspectors of elections. The member may request a
receipt for delivery.
   (f) All votes shall be counted and tabulated by the inspector or
inspectors of elections or his or her designee in public at a
properly noticed open meeting of the board of directors or members.
Any candidate or other member of the association may witness the
counting and tabulation of the votes. No person, including a member
of the association or an employee of the management company, shall
open or otherwise review any ballot prior to the time and place at
which the ballots are counted and tabulated. The inspector of
elections, or his or her designee, may verify the member's
information and signature on the outer envelope prior to the meeting
at which ballots are tabulated. Once a secret ballot is received by
the inspector of elections, it shall be irrevocable.
   (g) The tabulated results of the election shall be promptly
reported to the board of directors of the association and shall be
recorded in the minutes of the next meeting of the board of directors
and shall be available for review by members of the association.
Within 15 days of the election, the board shall publicize the
tabulated results of the election in a communication directed to all
members.
   (h) The sealed ballots at all times shall be in the custody of the
inspector or inspectors of elections or at a location designated by
the inspector or inspectors until after the tabulation of the vote,
and until the time allowed by Section 7527 of the Corporations Code
for challenging the election has expired, at which time custody shall
be transferred to the association. If there is a recount or other
challenge to the election process, the inspector or inspectors of
elections shall, upon written request, make the ballots available for
inspection and review by an association member or his or her
authorized representative. Any recount shall be conducted in a manner
that preserves the confidentiality of the vote.
   (i) After the transfer of the ballots to the association, the
ballots shall be stored by the association in a secure place for no
less than one year after the date of the election.
   (j) Notwithstanding any other provision of law, the rules adopted
pursuant to this section may provide for the nomination of candidates
from the floor of membership meetings or nomination by any other
manner. Those rules may permit write-in candidates for ballots.
   (k) Except for the meeting to count the votes required in
subdivision (f), an election may be conducted entirely by mail unless
otherwise specified in the governing documents.
   (l) The provisions of this section apply to both incorporated and
unincorporated associations, notwithstanding any contrary provision
of the governing documents.
   (m) The procedures set forth in this section shall apply to votes
cast directly by the membership, but do not apply to votes cast by
delegates or other elected representatives.
   (n) In the event of a conflict between this section and the
provisions of the Nonprofit Mutual Benefit Corporation Law (Part 3
(commencing with Section 7110) of Division 2 of Title 1 of the
Corporations Code) relating to elections, the provisions of this
section shall prevail.
   (o) The amendments made to this section by the act adding this
subdivision shall become operative on July 1, 2006.
  SEC. 30.  Section 2954 of the Civil Code is amended to read:
   2954.  (a) (1) No impound, trust, or other type of account for
payment of taxes on the property, insurance premiums, or other
purposes relating to the property shall be required as a condition of
a real property sale contract or a loan secured by a deed of trust
or mortgage on real property containing only a single-family,
owner-occupied dwelling, except: (A) where required by a state or
federal regulatory authority, (B) where a loan is made, guaranteed,
or insured by a state or federal governmental lending or insuring
agency, (C) upon a failure of the purchaser or borrower to pay two
consecutive tax installments on the property prior to the delinquency
date for such payments, (D) where the original principal amount of
such a loan is (i) 90 percent or more of the sale price, if the
property involved is sold, or is (ii) 90 percent or more of the
appraised value of the property securing the loan, (E) whenever the
combined principal amount of all loans secured by the real property
exceeds 80 percent of the appraised value of the property securing
the loans, (F) where a loan is made in compliance with the
requirements for higher priced mortgage loans established in
Regulation Z, whether or not the loan is a higher priced mortgage
loan, or (G) where a loan is refinanced or modified in connection
with a lender's homeownership preservation program or a lender's
participation in such a program sponsored by a federal, state, or
local government authority or a nonprofit organization. Nothing
contained in this section shall preclude establishment of such an
account on terms mutually agreeable to the parties to the loan, if,
prior to the execution of the loan or sale agreement, the seller or
lender has furnished to the purchaser or borrower a statement in
writing, which may be set forth in the loan application, to the
effect that the establishment of such an account shall not be
required as a condition to the execution of the loan or sale
agreement, and further, stating whether or not interest will be paid
on the funds in such an account.
   An impound, trust, or other type of account for the payment of
taxes, insurance premiums, or other purposes relating to property
established in violation of this subdivision is voidable, at the
option of the purchaser or borrower, at any time, but shall not
otherwise affect the validity of the loan or sale.
   (2) For the purposes of this subdivision, "Regulation Z" means any
rule, regulation, or interpretation promulgated by the Board of
Governors of the Federal Reserve System and any interpretation or
approval issued by an official or employee duly authorized by the
board to issue interpretations or approvals dealing with,
respectively, consumer leasing or consumer lending, pursuant to the
federal Truth in Lending Act, as amended (15 U.S.C. Sec. 1601 et
seq.).
   (b) Every mortgagee of real property, beneficiary under a deed of
trust on real property, or vendor on a real property sale contract
upon the written request of the mortgagor, trustor, or vendee shall
furnish to the mortgagor, trustor, or vendee for each calendar year
within 60 days after the end of the year an itemized accounting of
moneys received for interest and principal repayment and received and
held in or disbursed from an impound or trust account, if any, for
payment of taxes on the property, insurance premiums, or other
purposes relating to the property subject to the mortgage, deed of
trust, or real property sale contract. The mortgagor, trustor, or
vendee shall be entitled to receive one such accounting for each
calendar year without charge and shall be entitled to additional
similar accountings for one or more months upon written request and
on payment in advance of fees as follows:
   (1) Fifty cents ($0.50) per statement when requested in advance on
a monthly basis for one or more years.
   (2) One dollar ($1) per statement when requested for only one
month.
   (3) Five dollars ($5) if requested for a single cumulative
statement giving all the information described above back to the last
statement rendered.
   If the mortgagee, beneficiary, or vendor transmits to the
mortgagor, trustor, or vendee a monthly statement or passbook showing
moneys received for interest and principal repayment and received
and held in and disbursed from an impound or trust account, if any,
the mortgagee, beneficiary, or vendor shall be deemed to have
complied with this section.
   No increase in the monthly rate of payment of a mortgagor,
trustor, or vendee on a real property sale contract for impound or
trust accounts shall be effective until after the mortgagee,
beneficiary, or vendor has furnished the mortgagor, trustor, or
vendee with an itemized accounting of the moneys presently held by it
in the accounts, and a statement of the new monthly rate of payment,
and an explanation of the factors necessitating the increase.
   The provisions of this section shall be in addition to the
obligations of the parties as stated by Section 2943.
   Every person who willfully or repeatedly violates this subdivision
shall be subject to punishment by a fine of not less than fifty
dollars ($50) nor more than two hundred dollars ($200).
   (c) As used in this section, "single-family, owner-occupied
dwelling" means a dwelling that will be owned and occupied by a
signatory to the mortgage or deed of trust secured by that dwelling
within 90 days of the execution of the mortgage or deed of trust.
  SEC. 31.  Section 128.6 of the Code of Civil Procedure is repealed.

  SEC. 32.  Section 209 of the Code of Civil Procedure, as amended by
Section 6 of Chapter 567 of the Statutes of 2006, is repealed.
  SEC. 33.  Section 234 of the Code of Civil Procedure is amended to
read:
   234.  Whenever, in the opinion of a judge of a superior court
about to try a civil or criminal action or proceeding, the trial is
likely to be a protracted one, or upon stipulation of the parties,
the court may cause an entry to that effect to be made in the minutes
of the court and thereupon, immediately after the jury is impaneled
and sworn, the court may direct the calling of one or more additional
jurors, in its discretion, to be known as "alternate jurors."
   These alternate jurors shall be drawn from the same source, and in
the same manner, and have the same qualifications, as the jurors
already sworn, and shall be subject to the same examination and
challenges. However, each side, or each defendant, as provided in
Section 231, shall be entitled to as many peremptory challenges to
the alternate jurors as there are alternate jurors called.
   The alternate jurors shall be seated so as to have equal power and
facilities for seeing and hearing the proceedings in the case, and
shall take the same oath as the jurors already selected, and shall,
unless excused by the court, attend at all times upon the trial of
the cause in company with the other jurors, but shall not participate
in deliberation unless ordered by the court, and for a failure to do
so are liable to be punished for contempt.
   They shall obey the orders of and be bound by the admonition of
the court, upon each adjournment of the court; but if the regular
jurors are ordered to be kept in the custody of the sheriff or
marshal during the trial of the cause, the alternate jurors shall
also be kept in confinement with the other jurors; and upon final
submission of the case to the jury, the alternate jurors shall be
kept in the custody of the sheriff or marshal who shall not suffer
any communication to be made to them except by order of the court,
and shall not be discharged until the original jurors are discharged,
except as provided in this section.
   If at any time, whether before or after the final submission of
the case to the jury, a juror dies or becomes ill, or upon other good
cause shown to the court is found to be unable to perform his or her
duty, or if a juror requests a discharge and good cause appears
therefor, the court may order the juror to be discharged and draw the
name of an alternate, who shall then take his or her place in the
jury box, and be subject to the same rules and regulations as though
he or she had been selected as one of the original jurors.
   All laws relative to fees, expenses, and mileage or transportation
of jurors shall be applicable to alternate jurors, except that in
civil cases the sums for fees and mileage or transportation need not
be deposited until the judge directs alternate jurors to be
impaneled.
  SEC. 33.5.  Section 349 of the Code of Civil Procedure is repealed.

  SEC. 34.  Section 425.16 of the Code of Civil Procedure is amended
to read:
   425.16.  (a) The Legislature finds and declares that there has
been a disturbing increase in lawsuits brought primarily to chill the
valid exercise of the constitutional rights of freedom of speech and
petition for the redress of grievances. The Legislature finds and
declares that it is in the public interest to encourage continued
participation in matters of public significance, and that this
participation should not be chilled through abuse of the judicial
process. To this end, this section shall be construed broadly.
   (b) (1) A cause of action against a person arising from any act of
that person in furtherance of the person's right of petition or free
speech under the United States Constitution or the California
Constitution in connection with a public issue shall be subject to a
special motion to strike, unless the court determines that the
plaintiff has established that there is a probability that the
plaintiff will prevail on the claim.
   (2) In making its determination, the court shall consider the
pleadings, and supporting and opposing affidavits stating the facts
upon which the liability or defense is based.
   (3) If the court determines that the plaintiff has established a
probability that he or she will prevail on the claim, neither that
determination nor the fact of that determination shall be admissible
in evidence at any later stage of the case, or in any subsequent
action, and no burden of proof or degree of proof otherwise
applicable shall be affected by that determination in any later stage
of the case or in any subsequent proceeding.
   (c) (1) Except as provided in paragraph (2), in any action subject
to subdivision (b), a prevailing defendant on a special motion to
strike shall be entitled to recover his or her attorney's fees and
costs. If the court finds that a special motion to strike is
frivolous or is solely intended to cause unnecessary delay, the court
shall award costs and reasonable attorney's fees to a plaintiff
prevailing on the motion, pursuant to Section 128.5.
   (2) A defendant who prevails on a special motion to strike in an
action subject to paragraph (1) shall not be entitled to attorney's
fees and costs if that cause of action is brought pursuant to Section
6259, 11130, 11130.3, 54960, or 54960.1 of the Government Code.
Nothing in this paragraph shall be construed to prevent a prevailing
defendant from recovering attorney's fees and costs pursuant to
subdivision (d) of Section 6259, 11130.5, or 54690.5.
   (d) This section shall not apply to any enforcement action brought
in the name of the people of the State of California by the Attorney
General, district attorney, or city attorney, acting as a public
prosecutor.
   (e) As used in this section, "act in furtherance of a person's
right of petition or free speech under the United States or
California Constitution in connection with a public issue" includes:
(1) any written or oral statement or writing made before a
legislative, executive, or judicial proceeding, or any other official
proceeding authorized by law, (2) any written or oral statement or
writing made in connection with an issue under consideration or
review by a legislative, executive, or judicial body, or any other
official proceeding authorized by law, (3) any written or oral
statement or writing made in a place open to the public or a public
forum in connection with an issue of public interest, or (4) any
other conduct in furtherance of the exercise of the constitutional
right of petition or the constitutional right of free speech in
connection with a public issue or an issue of public interest.
   (f) The special motion may be filed within 60 days of the service
of the complaint or, in the court's discretion, at any later time
upon terms it deems proper. The motion shall be scheduled by the
clerk of the court for a hearing not more than 30 days after the
service of the motion unless the docket conditions of the court
require a later hearing.
   (g) All discovery proceedings in the action shall be stayed upon
the filing of a notice of motion made pursuant to this section. The
stay of discovery shall remain in effect until notice of entry of the
order ruling on the motion. The court, on noticed motion and for
good cause shown, may order that specified discovery be conducted
notwithstanding this subdivision.
   (h) For purposes of this section, "complaint" includes
"cross-complaint" and "petition," "plaintiff" includes
"cross-complainant" and "petitioner," and "defendant" includes
"cross-defendant" and "respondent."
   (i) An order granting or denying a special motion to strike shall
be appealable under Section 904.1.
   (j) (1) Any party who files a special motion to strike pursuant to
this section, and any party who files an opposition to a special
motion to strike, shall, promptly upon so filing, transmit to the
Judicial Council, by e-mail or facsimile, a copy of the endorsed,
filed caption page of the motion or opposition, a copy of any related
notice of appeal or petition for a writ, and a conformed copy of any
order issued pursuant to this section, including any order granting
or denying a special motion to strike, discovery, or fees.
   (2) The Judicial Council shall maintain a public record of
information transmitted pursuant to this subdivision for at least
three years, and may store the information on microfilm or other
appropriate electronic media.
  SEC. 35.  Section 8971 of the Education Code is amended to read:
   8971.  As used in this chapter, the following terms shall have the
following meanings:
   (a) "Child development program" means a full-day or part-day
comprehensive developmental program for children ages 0 to 14 years
that is administered by the State Department of Education.
   (b) "Early primary program" means an integrated, experiential, and
developmentally appropriate educational program for children in
preschool, kindergarten, and grades 1 to 3, inclusive, that
incorporates various instructional strategies and authentic
assessment practices, including educationally appropriate curricula,
heterogeneous groupings, active learning activities, oral language
development, small group instruction, peer interaction, use of
concrete manipulative materials in the classroom, planned
articulation among preschool, kindergarten, and primary grades, and
parent involvement and education.
   (c) "Integrated, experiential, and developmentally appropriate
educational program" means a program that is designed around the
abilities and interests of the children in the program and one in
which children learn about the various subjects simultaneously, as
opposed to segmented courses, and through "hands-on" or "active
learning" teaching methods that are more appropriate for young
children than the academic "textbook" approach.
   (d) "Preschool program" means a comprehensive developmental
program for children who are too young to enroll in kindergarten.
   (e) "Portfolio material" means a selection of representative
samples of the child's performance within the program setting that
may include, but not be limited to, teacher observations, work
samples, developmental profiles, photographs, and audio or video
recordings that present a picture of the child's progress over time.
   (f) "School district" includes county offices of education.
   (g) "State preschool program" means a part-day comprehensive
developmental program for children three to five years of age from
low-income families, administered by the State Department of
Education.
  SEC. 36.  Section 14035 of the Education Code is amended to read:
   14035.  (a) The county school service fund contingency account is
hereby established in the General Fund. In each fiscal year the
amount credited to the account shall be one hundred thousand dollars
($100,000). Notwithstanding any provision of Section 14002 to the
contrary, the amount to be credited to the county school service fund
contingency account each fiscal year shall not be transferred from
the General Fund as required or authorized to be transferred by
Section 14002, but the amounts required or authorized to be
transferred by Section 14002 shall be reduced by the amount to be
credited to the contingency account and shall remain in the General
Fund to the credit of the contingency account.
   (b) The moneys in the General Fund to the credit of the
contingency account shall be transferred by the Controller to the
State School Fund in amounts as are certified from time to time by
the Superintendent of Public Instruction to be necessary to meet
actual costs to reimburse county superintendents of schools for
expenses incurred in providing emergency education to pupils and
making financial grants to school districts pursuant to Section 1602,
to reimburse county superintendents of schools for the actual and
necessary travel expenses incurred
                  in connection with cooperative county publication
projects by the county superintendent of schools or members of his or
her staff, and to reimburse county superintendents of schools for
expenses incurred in making emergency financial grants to school
districts.
   (c) The amount credited, pursuant to this section, in each fiscal
year to the county school service fund contingency account in the
General Fund shall be reduced by the amount of the balance remaining
to the account on June 30 of the preceding fiscal year and an equal
reduction shall be made in the amount of the reduction in the amounts
required or authorized to be transferred under Section 14002 in
accordance with this section.
  SEC. 37.  Section 33128.3 of the Education Code is amended to read:

   33128.3.  (a) Notwithstanding the standards and criteria adopted
pursuant to paragraph (3) of subdivision (a) of Section 33128, for
the 2009-10 fiscal year, the minimum state requirement for a reserve
for economic uncertainties is one-third of the percentage for a
reserve adopted by the state board pursuant to Section 33128 as of
May 1, 2009.
   (b) The school district shall make progress, in the 2010-11 fiscal
year, toward returning to compliance with the standards and criteria
adopted pursuant to paragraph (3) of subdivision (a) of Section
33128.
   (c) For the 2011-12 fiscal year, the minimum state requirement for
a reserve for economic uncertainties shall be restored to the
percentage adopted by the state board pursuant to Section 33128 as of
May 1, 2009.
   (d) This section shall become inoperative on July 1, 2012, and, as
of January 1, 2013, is repealed, unless a later enacted statute,
that becomes operative on or before January 1, 2013, deletes or
extends the dates on which it becomes inoperative and is repealed.
  SEC. 38.  Section 42238 of the Education Code is amended to read:
   42238.  (a) For the 1984-85 fiscal year and each fiscal year
thereafter, the county superintendent of schools shall determine a
revenue limit for each school district in the county pursuant to this
section.
   (b) The base revenue limit for a fiscal year shall be determined
by adding to the base revenue limit for the prior fiscal year the
following amounts:
   (1) The inflation adjustment specified in Section 42238.1.
   (2) For the 1995-96 fiscal year, the equalization adjustment
specified in Section 42238.4.
   (3) For the 1996-97 fiscal year, the equalization adjustments
specified in Sections 42238.41, 42238.42, and 42238.43.
   (4) For the 1985-86 fiscal year, the amount per unit of average
daily attendance received in the 1984-85 fiscal year pursuant to
Section 42238.7.
   (5) For the 1985-86, 1986-87, and 1987-88 fiscal years, the amount
per unit of average daily attendance received in the prior fiscal
year pursuant to Section 42238.8.
   (6) For the 2004-05 fiscal year, the equalization adjustment
specified in Section 42238.44.
   (7) For the 2006-07 fiscal year, the equalization adjustment
specified in Section 42238.48.
   (8) For the 2011-12 fiscal year, the equalization adjustment
specified in Section 42238.49.
   (c) (1) (A) For the 2010-11 fiscal year, the Superintendent shall
compute an add-on for each school district by adding the inflation
adjustment specified in Section 42238.1 to the adjustment specified
in Section 42238.485.
   (B) For the 2011-12 fiscal year and each fiscal year thereafter,
the Superintendent shall compute an add-on for each school district
by adding the inflation adjustment specified in Section 42238.1 to
the amount computed pursuant to this paragraph for the prior fiscal
year.
   (2) Commencing with the 2010-11 fiscal year, the Superintendent
shall compute an add-on for each school district by dividing each
school district's fiscal year average daily attendance computed
pursuant to Section 42238.5 by the total adjustments in funding for
each district made for the 2007-08 fiscal year pursuant to Section
42238.22 as it read on January 1, 2009.
   (d) The sum of the base revenue limit computed pursuant to
subdivision (b) and the add-on computed pursuant to subdivision (c)
shall be multiplied by the district average daily attendance computed
pursuant to Section 42238.5.
   (e) For districts electing to compute units of average daily
attendance pursuant to paragraph (2) of subdivision (a) of Section
42238.5, the amount computed pursuant to Article 4 (commencing with
Section 42280) shall be added to the amount computed in subdivision
(c) or (d), as appropriate.
   (f) For the 1984-85 fiscal year only, the county superintendent
shall reduce the total revenue limit computed in this section by the
amount of the decreased employer contributions to the Public
Employees' Retirement System resulting from enactment of Chapter 330
of the Statutes of 1982, offset by any increase in those
contributions, as of the 1983-84 fiscal year, resulting from
subsequent changes in employer contribution rates.
   (g) The reduction required by subdivision (f) shall be calculated
as follows:
   (1) Determine the amount of employer contributions that would have
been made in the 1983-84 fiscal year if the applicable Public
Employees' Retirement System employer contribution rate in effect
immediately prior to the enactment of Chapter 330 of the Statutes of
1982 was in effect during the 1983-84 fiscal year.
   (2) Subtract from the amount determined in paragraph (1) the
greater of subparagraph (A) or (B):
   (A) The amount of employer contributions that would have been made
in the 1983-84 fiscal year if the applicable Public Employees'
Retirement System employer contribution rate in effect immediately
after the enactment of Chapter 330 of the Statutes of 1982 was in
effect during the 1983-84 fiscal year.
   (B) The actual amount of employer contributions made to the Public
Employees' Retirement System in the 1983-84 fiscal year.
   (3) For purposes of this subdivision, employer contributions to
the Public Employees' Retirement System for either of the following
shall be excluded from the calculation specified above:
   (A) Positions supported totally by federal funds that were subject
to supplanting restrictions.
   (B) Positions supported, to the extent of employer contributions
not exceeding twenty-five thousand dollars ($25,000) by a single
educational agency, from a revenue source determined on the basis of
equity to be properly excludable from the provisions of this
subdivision by the Superintendent with the approval of the Director
of Finance.
   (4) For accounting purposes, the reduction made by this
subdivision may be reflected as an expenditure from appropriate
sources of revenue as directed by the Superintendent.
   (h) The Superintendent shall apportion to each school district the
amount determined in this section less the sum of:
   (1) The district's property tax revenue received pursuant to
Chapter 3.5 (commencing with Section 75) and Chapter 6 (commencing
with Section 95) of Part 0.5 of Division 1 of the Revenue and
Taxation Code.
   (2) The amount, if any, received pursuant to Part 18.5 (commencing
with Section 38101) of Division 2 of the Revenue and Taxation Code.
   (3) The amount, if any, received pursuant to Chapter 3 (commencing
with Section 16140) of Part 1 of Division 4 of Title 2 of the
Government Code.
   (4) Prior years' taxes and taxes on the unsecured roll.
   (5) Fifty percent of the amount received pursuant to Section
41603.
   (6) The amount, if any, received pursuant to the Community
Redevelopment Law (Part 1 (commencing with Section 33000) of Division
24 of the Health and Safety Code), except for any amount received
pursuant to Section 33401 or 33676 of the Health and Safety Code that
is used for land acquisition, facility construction, reconstruction,
or remodeling, or deferred maintenance, except for any amount
received pursuant to Section 33492.15 of, paragraph (4) of
subdivision (a) of Section 33607.5 of, or Section 33607.7 of, the
Health and Safety Code that is allocated exclusively for educational
facilities.
   (7) For a unified school district, other than a unified school
district that has converted all of its schools to charter status
pursuant to Section 47606, the amount of statewide average
general-purpose funding per unit of average daily attendance received
by school districts for each of four grade level ranges, as computed
by the department pursuant to Section 47633, multiplied by the
average daily attendance, in corresponding grade level ranges, of any
pupils who attend charter schools funded pursuant to Chapter 6
(commencing with Section 47630) of Part 26.8 of Division 4 for which
the district is the sponsoring local educational agency, as defined
in Section 47632, and who reside in and would otherwise have been
eligible to attend a noncharter school of the district.
   (i) A transfer of pupils of grades 7 and 8 between an elementary
school district and a high school district shall not result in the
receiving district receiving a revenue limit apportionment for those
pupils that exceeds 105 percent of the statewide average revenue
limit for the type and size of the receiving school district.
  SEC. 39.  Section 42605 of the Education Code is amended to read:
   42605.  (a) (1) Unless otherwise prohibited under federal law or
otherwise specified in subdivision (e), for the 2008-09 fiscal year
to the 2012-13 fiscal year, inclusive, recipients of funds from the
items listed in paragraph (2) may use funding received, pursuant to
subdivision (b), from any of these items listed in paragraph (2) that
are contained in an annual Budget Act, for any educational purpose.
   (2) Items 6110-104-0001, 6110-105-0001, 6110-108-0001,
6110-122-0001, 6110-123-0001, 6110-124-0001, 6110-137-0001,
6110-144-0001, 6110-150-0001, 6110-151-0001, 6110-156-0001,
6110-181-0001, 6110-188-0001, 6110-189-0001, 6110-190-0001,
6110-193-0001, 6110-195-0001, 6110-198-0001, 6110-204-0001,
6110-208-0001, 6110-209-0001, 6110-211-0001, 6110-227-0001,
6110-228-0001, 6110-232-0001, 6110-240-0001, 6110-242-0001,
6110-243-0001, 6110-244-0001, 6110-245-0001, 6110-246-0001,
6110-247-0001, 6110-248-0001, 6110-260-0001, 6110-265-0001,
6110-266-0001, 6110-267-0001, 6110-268-0001, and 6360-101-0001 of
Section 2.00.
   (b) (1) For the 2009-10 fiscal year to the 2012-13 fiscal year,
inclusive, the Superintendent or other administering state agency, as
appropriate, shall apportion from the amounts provided in the annual
Budget Act for the items enumerated in paragraph (2) of subdivision
(a) an amount to recipients based on the same relative proportion
that the recipient received in the 2008-09 fiscal year for the
programs funded through the items enumerated in paragraph (2) of
subdivision (a).
   (2) This section and Section 42 of Chapter 12 of the 2009-10 Third
Extraordinary Session do not authorize a school district that
receives funding on behalf of a charter school pursuant to Sections
47634.1 and 47651 to redirect this funding for another purpose unless
otherwise authorized in law or pursuant to an agreement between a
charter school and its chartering authority. Notwithstanding
paragraph (1), for the 2008-09 fiscal year to the 2012-13 fiscal
year, inclusive, a school district that receives funding on behalf of
a charter school pursuant to Sections 47634.1 and 47651 shall
continue to distribute the funds to those charter schools based on
the relative proportion that the school district distributed in the
2007-08 fiscal year, and shall adjust those amounts to reflect
changes in charter school attendance in the district. The amounts
allocated shall be adjusted for any greater or lesser amount
appropriated for the items enumerated in paragraph (2) of subdivision
(a). For a charter school that began operation in the 2008-09 fiscal
year, if a school district received funding on behalf of that
charter school pursuant to Sections 47634.1 and 47651, the school
district shall continue to distribute the funds to that charter
school based on the relative proportion that the school district
distributed in the 2008-09 fiscal year and shall adjust the amount of
those funds to reflect changes in charter school attendance in the
district. The amounts allocated shall be adjusted for any greater or
lesser amount appropriated for the items enumerated in paragraph (2)
of subdivision (a).
   (3) Notwithstanding paragraph (1), for the 2008-09 fiscal year to
the 2012-13 fiscal year, inclusive, the Superintendent shall
apportion from the amounts appropriated by Item 6110-211-0001 of
Section 2.00 of the annual Budget Act an amount to a charter school
in accordance with the per-pupil methodology prescribed in
subdivision (c) of Section 47634.1.
   (4) Notwithstanding paragraph (1), for the 2008-09 fiscal year to
the 2012-13 fiscal year, inclusive, the Superintendent shall
apportion from the amounts provided in the annual Budget Act an
amount to a school district, charter school, and county office of
education based on the same relative proportion that the local
educational agency received in the 2007-08 fiscal year for the
programs funded through the following items contained in the annual
Budget Act: 6110-104-0001, 6110-105-0001, 6110-156-0001,
6110-190-0001, Schedule (3) of 6110-193-0001, 6110-198-0001,
6110-232-0001, and Schedule (2) of 6110-240-0001.
   (5) For purposes of paragraph (4), if a direct-funded charter
school began operation in the 2008-09 fiscal year, the amount that
the charter school was entitled to receive from the items enumerated
in paragraph (4) for the 2008-09 fiscal year, as certified by the
Superintendent in March 2009, is deemed to have been received in the
2007-08 fiscal year.
   (c) (1) This section does not obligate the state to refund or
repay reductions made pursuant to this section. A decision by a
school district to reduce funding pursuant to this section for a
state-mandated local program shall constitute a waiver of the
subvention of funds that the school district is otherwise entitled to
pursuant to Section 6 of Article XIII B of the California
Constitution on the amount so reduced.
   (2) As a condition of receipt of funds, the governing board of the
school district or board of the county office of education, as
appropriate, at a regularly scheduled open public hearing shall take
testimony from the public, discuss, approve or disapprove the
proposed use of funding, and make explicit for each of the budget
items in paragraph (2) of subdivision (a) the purposes for which the
funds will be used.
   (3) Using the Standardized Account Code Structure reporting
process, a local educational agency shall report expenditures of
funds pursuant to the authority of this section by using the
appropriate function codes to indicate the activities for which these
funds are expended. The department shall collect and provide this
information to the Department of Finance and the appropriate policy
and budget committees of the Legislature by April 15, 2010, and
annually thereafter on April 15 until, and including, April 15, 2014.

   (d) For the 2008-09 fiscal year to the 2012-13 fiscal year,
inclusive, local educational agencies that use the flexibility
provision of this section shall be deemed to be in compliance with
the program and funding requirements contained in statutory,
regulatory, and provisional language, associated with the items
enumerated in subdivision (a).
   (e) Notwithstanding subdivision (d), the following requirements
shall continue to apply:
   (1) For Items 6110-105-0001 and 6110-156-0001, the amount
authorized for flexibility shall exclude the funding provided for
instruction of CalWORKs-eligible students pursuant to Schedules (2)
and (3) and Provisions 2 and 4.
   (2) (A) Any instructional materials purchased by a local
educational agency shall be the materials adopted by the state board
for kindergarten and grades 1 to 8, inclusive, and for grades 9 to
12, inclusive, the materials purchased shall be aligned with state
standards as defined by Section 60605, and shall also meet the
reporting and sufficiency requirements contained in Section 60119.
   (B) For purposes of this section, "sufficiency" means that each
pupil has sufficient textbooks and instructional materials in the
four core areas as defined by Section 60119 and that all pupils
within the local educational agency who are enrolled in the same
course shall have identical textbooks and instructional materials, as
specified in Section 1240.3.
   (3) For Item 6110-195-0001, the item shall exclude moneys that are
required to fund awards for teachers that have previously met the
requirements necessary to obtain these awards, until the award is
paid in full.
   (4) For Item 6110-266-0001, a county office of education shall
conduct at least one site visit to each of the required schoolsites
pursuant to Section 1240 and shall fulfill all of the duties set
forth in Sections 1240 and 44258.9.
   (5) For Item 6110-198-0001, a school district or county office of
education that operates the child care component of the Cal-SAFE
program shall comply with paragraphs (5) and (6) of subdivision (c)
of Section 54746.
   (f) This section does not invalidate any state law pertaining to
teacher credentialing requirements or the functions that require
credentials.
  SEC. 40.  Section 42606 of the Education Code is amended to read:
   42606.  (a) A local educational agency, including a direct-funded
charter school, may apply for any state categorical program funding
included in the annual Budget Act on behalf of a school that begins
operation in the 2008-09 to the 2012-13 fiscal years, inclusive, but
only to the extent the school or local educational agency is eligible
for funding and meets the provisions of the program that were in
effect as of January 1, 2009, except that charter schools shall not
apply for any of the programs contained in Section 47634.4.
   (b) A local educational agency that establishes a new school by
redirecting enrollment from its existing schools to the new school
shall not be eligible to receive funding in addition to the amounts
allocated pursuant to Section 42605 for the categorical programs
specified in that section or for the Class Size Reduction Program
pursuant to Sections 52122 and 52124.
   (c) The Superintendent shall report the number of new schools and
the programs that these schools are applying for, including an
estimate of the cost for that year. This information shall be
reported by November 11, 2009, and each fiscal year thereafter, to
the appropriate committees of the Legislature, the Legislative
Analyst's Office, and the Department of Finance.
  SEC. 41.  Section 44346.5 of the Education Code is amended to read:

   44346.5.  (a) The Commission on Teacher Credentialing shall submit
to the Department of Justice fingerprint images and related
information required by the Department of Justice of all individuals,
as described in subdivision (a) of Section 49024, for the purposes
of obtaining information as to the existence and content of a record
of state or federal convictions and state or federal arrests and also
information as to the existence and content of a record of state or
federal arrests for which the Department of Justice establishes that
the individual is free on bail or on his or her own recognizance
pending trial or appeal.
   (b) When received, the Department of Justice shall forward to the
Federal Bureau of Investigation requests for federal summary criminal
history information received pursuant to this section. The
Department of Justice shall review the information returned from the
Federal Bureau of Investigation and compile and disseminate a
response to the commission.
   (c) The Department of Justice shall provide a state and federal
level response to the commission pursuant to paragraph (1) of
subdivision (p) of Section 11105 of the Penal Code.
   (d) The commission shall request from the Department of Justice
subsequent arrest notification service, as provided pursuant to
Section 11105.2 of the Penal Code, for individuals described in
subdivision (a) of Section 49024 of this code.
   (e) The Department of Justice shall charge a fee sufficient to
cover the cost of processing the request described in this section.
   (f) (1) If a denial of an application for a certificate is due at
least in part to the individual's state or federal criminal history
record, the commission shall provide to the individual a copy of his
or her criminal history record search response with the notice of the
denial.
   (2) The state or federal criminal history record search response
shall not be modified or altered from its form or content as provided
by the Department of Justice.
   (3) The criminal history record search response shall be provided
in such a manner as to protect the confidentiality and privacy of the
individual's criminal history record and the criminal history record
search response shall not be made available by the commission to any
school district or county office of education.
   (4) The commission shall retain a copy of the individual's
criminal history record search response, and the date and the address
to which it was sent. The commission shall make this information
available upon request by the Department of Justice or the Federal
Bureau of Investigation.
  SEC. 42.  Section 44856 of the Education Code is amended to read:
   44856.  The governing board of a school district, for the purposes
of providing bilingual instruction, foreign language instruction, or
cultural enrichment, in the schools of the district, subject to the
rules and regulations of the state board, may conclude arrangements
with the proper authorities of a foreign country, or of a state,
territory, or possession of the United States, for the hiring of
bilingual teachers employed in public or private schools of a foreign
country, state, territory, or possession. To be eligible for
employment, the teacher must speak English fluently. Any persons
employed pursuant to this section shall be known as a "sojourn
certificated employee."
   A person shall not be hired as a sojourn certificated employee by
a school district unless he or she holds the necessary valid
credential or credentials issued by the Commission on Teacher
Credentialing authorizing the person to serve in a position requiring
certification qualifications in the school district proposing to
employ him or her. The person may be employed for a period not to
exceed two years, except that thereafter the period of employment may
be extended from year to year for a total period of not more than
five years upon verification by the employing district that
termination of the employment would adversely affect an existing
bilingual or foreign language program or program of cultural
enrichment, and that attempts to secure the employment of a
certificated California teacher qualified to fill the position have
been unsuccessful. The commission shall establish minimum standards
for the credentials for sojourn certificated employees.
  SEC. 43.  Section 45103.1 of the Education Code is amended to read:

   45103.1.  (a) Notwithstanding any other provision of this chapter,
personal services contracting for all services currently or
customarily performed by classified school employees to achieve cost
savings is permissible, unless otherwise prohibited, when all the
following conditions are met:
   (1) The governing board or contracting agency clearly demonstrates
that the proposed contract will result in actual overall cost
savings to the school district, provided that:
   (A) In comparing costs, there shall be included the school
district's additional cost of providing the same service as proposed
by a contractor. These additional costs shall include the salaries
and benefits of additional staff that would be needed and the cost of
additional space, equipment, and materials needed to perform the
function.
   (B) In comparing costs, there shall not be included the school
district's indirect overhead costs unless these costs can be
attributed solely to the function in question and would not exist if
that function was not performed by the school district. Indirect
overhead costs shall mean the pro rata share of existing
administrative salaries and benefits, rent, equipment costs,
utilities, and materials.
   (C) In comparing costs, there shall be included in the cost of a
contractor providing a service any continuing school district costs
that would be directly associated with the contracted function. These
continuing school district costs shall include, but not be limited
to, those for inspection, supervision, and monitoring.
   (2) Proposals to contract out work shall not be approved solely on
the basis that savings will result from lower contractor pay rates
or benefits. Proposals to contract out work shall be eligible for
approval if the contractor's wages are at the industry's level and do
not undercut school district pay rates.
   (3) The contract does not cause the displacement of school
district employees. The term "displacement" includes layoff,
demotion, involuntary transfer to a new classification, involuntary
transfer to a new location requiring a change of residence, and time
base reductions. Displacement does not include changes in shifts or
days off, nor does it include reassignment to other positions within
the same classification and general location or employment with the
contractor, so long as wages and benefits are comparable to those
paid by the school district.
   (4) The savings shall be large enough to ensure that they will not
be eliminated by private sector and district cost fluctuations that
could normally be expected during the contracting period.
   (5) The amount of savings clearly justify the size and duration of
the contracting agreement.
   (6) The contract is awarded through a publicized, competitive
bidding process.
   (7) The contract includes specific provisions pertaining to the
qualifications of the staff that will perform the work under the
contract, as well as assurance that the contractor's hiring practices
meet applicable nondiscrimination standards.
   (8) The potential for future economic risk to the school district
from potential contractor rate increases is minimal.
   (9) The contract is with a firm. A "firm" means a corporation,
limited liability company, partnership, nonprofit organization, or
sole proprietorship.
   (10) The potential economic advantage of contracting is not
outweighed by the public's interest in having a particular function
performed directly by the school district.
   (b) Notwithstanding any other provision of this chapter, personal
services contracting shall also be permissible when any of the
following conditions can be met:

           (1) The contract is for new school district functions and
the Legislature has specifically mandated or authorized the
performance of the work by independent contractors.
   (2) The services contracted are not available within the district,
cannot be performed satisfactorily by school district employees, or
are of such a highly specialized or technical nature that the
necessary expert knowledge, experience, and ability are not available
through the school district.
   (3) The services are incidental to a contract for the purchase or
lease of real or personal property. Contracts under this criterion,
known as "service agreements," shall include, but not be limited to,
agreements to service or maintain office equipment or computers that
are leased or rented.
   (4) The policy, administrative, or legal goals and purposes of the
district cannot be accomplished through the utilization of persons
selected pursuant to the regular or ordinary school district hiring
process. Contracts are permissible under this criterion to protect
against a conflict of interest or to ensure independent and unbiased
findings in cases where there is a clear need for a different,
outside perspective. These contracts shall include, but not be
limited to, obtaining expert witnesses in litigation.
   (5) The nature of the work is such that the criteria for emergency
appointments apply. "Emergency appointment" means an appointment
made for a period not to exceed 60 working days either during an
actual emergency to prevent the stoppage of public business or
because of the limited duration of the work. The method of selection
and the qualification standards for an emergency employee shall be
determined by the district. The frequency of appointment, length of
employment, and the circumstances appropriate for the appointment of
firms or individuals under emergency appointments shall be restricted
so as to prevent the use of emergency appointments to circumvent the
regular or ordinary hiring process.
   (6) The contractor will provide equipment, materials, facilities,
or support services that could not feasibly be provided by the school
district in the location where the services are to be performed.
   (7) The services are of such an urgent, temporary, or occasional
nature that the delay incumbent in their implementation under the
district's regular or ordinary hiring process would frustrate their
very purpose.
   (c) This section shall apply to all school districts, including
districts that have adopted the merit system.
   (d) This section shall apply to personal service contracts entered
into after January 1, 2003. This section shall not apply to the
renewal of personal services contracts subsequent to January 1, 2003,
where the contract was entered into before January 1, 2003,
irrespective of whether the contract is renewed or rebid with the
existing contractor or with a new contractor.
  SEC. 44.  Section 49701 of the Education Code is amended to read:
   49701.  The provisions of the Interstate Compact on Educational
Opportunity for Military Children are as follows:


   Article I.  Purpose


   It is the purpose of this compact to remove barriers to
educational success imposed on children of military families because
of frequent moves and deployment of their parents by:
   (A) Facilitating the timely enrollment of children of military
families and ensuring that they are not placed at a disadvantage due
to difficulty in the transfer of education records from the previous
school district(s) or variations in entrance/age requirements.
   (B) Facilitating the student placement process through which
children of military families are not disadvantaged by variations in
attendance requirements, scheduling, sequencing, grading, course
content, or assessment.
   (C) Facilitating the qualification and eligibility for enrollment,
educational programs, and participation in extracurricular academic,
athletic, and social activities.
   (D) Facilitating the on-time graduation of children of military
families.
   (E) Providing for the promulgation and enforcement of
administrative rules implementing the provisions of this compact.
   (F) Providing for the uniform collection and sharing of
information between and among member states, schools, and military
families under this compact.
   (G) Promoting coordination between this compact and other compacts
affecting military children.
   (H) Promoting flexibility and cooperation between the educational
system, parents and the student in order to achieve educational
success for the student.


   Article II.  Definitions


   As used in this compact, unless the context clearly requires a
different construction:
   (A) "Active duty" means: full-time duty status in the active
uniformed service of the United States, including members of the
National Guard and Reserve on active duty orders pursuant to 10
U.S.C. Sections 1209 and 1211.
   (B) "Children of military families" means: a school-aged child or
children, enrolled in Kindergarten through Twelfth (12th) grade, in
the household of an active duty member.
   (C) "Compact commissioner" means: the voting representative of
each compacting state appointed pursuant to Article VIII of this
compact.
   (D) "Deployment" means: the period one (1) month prior to the
service members' departure from their home station on military orders
though six (6) months after return to their home station.
   (E) "Educational records" means: those official records, files,
and data directly related to a student and maintained by the school
or local education agency, including, but not limited to, records
encompassing all the material kept in the student's cumulative folder
such as general identifying data, records of attendance and of
academic work completed, records of achievement and results of
evaluative tests, health data, disciplinary status, test protocols,
and individualized education programs.
   (F) "Extracurricular activities" means: a voluntary activity
sponsored by the school or local education agency or an organization
sanctioned by the local education agency. Extracurricular activities
include, but are not limited to, preparation for and involvement in
public performances, contests, athletic competitions, demonstrations,
displays, and club activities.
   (G) "Interstate Commission on Educational Opportunity for Military
Children" means: the commission that is created under Article IX of
this compact, which is generally referred to as Interstate
Commission.
   (H) "Local education agency" means: a public authority legally
constituted by the state as an administrative agency to provide
control of and direction for Kindergarten through Twelfth (12th)
grade public educational institutions.
   (I) "Member state" means: a state that has enacted this compact.
   (J) "Military installation" means: a base, camp, post, station,
yard, center, homeport facility for any ship, or other activity under
the jurisdiction of the Department of Defense, including any leased
facility, which is located within any of the several states, the
District of Columbia, the Commonwealth of Puerto Rico, the U.S.
Virgin Islands, Guam, American Samoa, the Northern Marianas Islands,
and any other U.S. Territory. Such term does not include any facility
used primarily for civil works, rivers and harbors projects, or
flood control projects.
   (K) "Non-member state" means: a state that has not enacted this
compact.
   (L) "Receiving state" means: the state to which a child of a
military family is sent, brought, or caused to be sent or brought.
   (M) "Rule" means: a written statement by the Interstate Commission
promulgated pursuant to Article XII of this compact that is of
general applicability, implements, interprets, or prescribes a policy
or provision of the Compact, or an organizational, procedural, or
practice requirement of the Interstate Commission, and has the force
and effect of statutory law in a member state, and includes the
amendment, repeal, or suspension of an existing rule.
   (N) "Sending state" means: the state from which a child of a
military family is sent, brought, or caused to be sent or brought.
   (O) "State" means: a state of the United States, the District of
Columbia, the Commonwealth of Puerto Rico, the U.S. Virgin Islands,
Guam, American Samoa, the Northern Marianas Islands, and any other
U.S. Territory.
   (P) "Student" means: the child of a military family for whom the
local education agency receives public funding and who is formally
enrolled in Kindergarten through Twelfth (12th) grade.
   (Q) "Transition" means: 1) the formal and physical process of
transferring from school to school or 2) the period of time in which
a student moves from one school in the sending state to another
school in the receiving state.
   (R) "Uniformed service(s)" means: the U.S. Army, Navy, Air Force,
Marine Corps, or Coast Guard, as well as the Commissioned Corps of
the National Oceanic and Atmospheric Administration and the U.S.
Public Health Services.
   (S) "Veteran" means: a person who served in the uniformed services
and who was discharged or released therefrom under conditions other
than dishonorable.


   Article III.  Applicability


   (A) Except as otherwise provided in Section B, this compact shall
apply to the children of:
   (1) Active duty members of the uniformed services as defined in
this compact, including members of the National Guard and Military
Reserve on active duty orders pursuant to 10 U.S.C. Sections 1209 and
1211;
   (2) Members or veterans of the uniformed services who are severely
injured and medically discharged or retired for a period of one (1)
year after medical discharge or retirement; and
   (3) Members of the uniformed services who die on active duty or as
a result of injuries sustained on active duty for a period of one
(1) year after death.
   (B) The provisions of this interstate compact shall only apply to
local education agencies as defined in this compact.
   (C) The provisions of this compact shall not apply to the children
of:
   (1) Inactive members of the National Guard and Military Reserve;
   (2) Members of the uniformed services now retired, except as
provided in Section A;
   (3) Veterans of the uniformed services, except as provided in
Section A; and
   (4) Other U.S. Dept. of Defense personnel and other federal agency
civilian and contract employees not defined as active duty members
of the uniformed services.


   Article IV.  Educational Records and Enrollment


   (A) Unofficial or "hand-carried" education records - In the event
that official education records cannot be released to the parents for
the purpose of transfer, the custodian of the records in the sending
state shall prepare and furnish to the parent a complete set of
unofficial educational records containing uniform information as
determined by the Interstate Commission to the extent feasible. Upon
receipt of the unofficial education records by a school in the
receiving state, the school shall enroll and appropriately place the
student based on the information provided in the unofficial records
pending validation by the official records, as quickly as possible.
   (B) Official education records/transcripts - Simultaneous with the
enrollment and conditional placement of the student, the school in
the receiving state shall request the student's official education
record from the school in the sending state. Upon receipt of this
request, the school in the sending state will process and furnish the
official education records to the school in the receiving state
within ten (10) days or within such time as is reasonably determined
under the rules promulgated by the Interstate Commission to the
extent practicable in each case.
   (C) Immunizations - Compacting states shall give thirty (30) days
from the date of enrollment or within such time as is reasonably
determined under the rules promulgated by the Interstate Commission,
for students to obtain any immunization(s) required by the receiving
state. For a series of immunizations, initial vaccinations must be
obtained within thirty (30) days or within such time as is reasonably
determined under the rules promulgated by the Interstate Commission.

   (D) Kindergarten and First (1st) grade entrance age - Students
shall be allowed to continue their enrollment at grade level in the
receiving state commensurate with their grade level (including
Kindergarten) from a local education agency in the sending state at
the time of transition, regardless of age. A student that has
satisfactorily completed the prerequisite grade level in the local
education agency in the sending state shall be eligible for
enrollment in the next highest grade level in the receiving state,
regardless of age. A student transferring after the start of the
school year in the receiving state shall enter the school in the
receiving state on his or her validated level from an accredited
school in the sending state.


   Article V.  Placement and Attendance


   (A) Course placement - When the student transfers before or during
the school year, the receiving state school shall initially honor
placement of the student in educational courses based on the student'
s enrollment in the sending state school and/or educational
assessments conducted at the school in the sending state if the
courses are offered and there is space available, as determined by
the school district. Course placement includes, but is not limited
to, Honors, International Baccalaureate, Advanced Placement,
vocational, technical and career pathways courses. Continuing the
student's academic program from the previous school and promoting
placement in academically and career challenging courses should be
paramount when considering placement. This does not preclude the
school in the receiving state from performing subsequent evaluations
to ensure appropriate placement and continued enrollment of the
student in the course(s).
   (B) Educational program placement - The receiving state school
shall initially honor placement of the student in educational
programs based on current educational assessments conducted at the
school in the sending state or participation/placement in like
programs in the sending state, provided that the program exists in
the school and there is space available, as determined by the school
district. Such programs include, but are not limited to: 1) gifted
and talented programs; and 2) English as a second language (ESL).
This does not preclude the school in the receiving state from
performing subsequent evaluations to ensure appropriate placement of
the student.
   (C) Special education services - 1) In compliance with the federal
requirements of the Individuals with Disabilities Education Act
(IDEA), 20 U.S.C.A. Section 1400 et seq., the receiving state shall
initially provide comparable services to a student with disabilities
based on his/her current Individualized Education Program (IEP); and
2) In compliance with the requirements of Section 504 of the
Rehabilitation Act, 29 U.S.C.A. Section 794, and with Title II of the
Americans with Disabilities Act, 42 U.S.C.A. Sections 12131-12165,
the receiving state shall make reasonable accommodations and
modifications to address the needs of incoming students with
disabilities, subject to an existing Section 504 or Title II Plan, to
provide the student with equal access to education. This does not
preclude the school in the receiving state from performing subsequent
evaluations to ensure appropriate placement of the student.
   (D) Placement flexibility - Local education agency administrative
officials shall have flexibility in waiving course/program
prerequisites, or other preconditions for placement in
courses/programs offered under the jurisdiction of the local
education agency.
   (E) Absence as related to deployment activities - A student whose
parent or legal guardian is an active duty member of the uniformed
services, as defined by the compact, and has been called to duty for,
is on leave from, or immediately returned from deployment to a
combat zone or combat support posting, shall be granted additional
excused absences at the discretion of the local education agency
superintendent to visit with his or her parent or legal guardian
relative to such leave or deployment of the parent or guardian.


   Article VI.  Eligibility


   (A) Eligibility for enrollment
   (1) Special power of attorney, relative to the guardianship of a
child of a military family and executed under applicable law, shall
be sufficient for the purposes of enrollment and all other actions
requiring parental participation and consent.
   (2) A local education agency shall be prohibited from charging
local tuition to a transitioning military child placed in the care of
a noncustodial parent or other person standing in loco parentis who
lives in a jurisdiction other than that of the custodial parent.
   (3) A transitioning military child, placed in the care of a
noncustodial parent or other person standing in loco parentis, who
lives in a jurisdiction other than that of the custodial parent, may
continue to attend the school in which he/she was enrolled while
residing with the custodial parent.
   (B) Eligibility for extracurricular participation - State and
local education agencies shall facilitate the opportunity for
transitioning military children's inclusion in extracurricular
activities, regardless of application deadlines, to the extent they
are otherwise qualified and space is available, as determined by the
school district.


   Article VII.  Graduation


   In order to facilitate the on-time graduation of children of
military families, states and local education agencies shall
incorporate the following procedures:
   (A) Waiver requirements - Local education agency administrative
officials shall use best efforts to waive specific courses required
for graduation if similar coursework has been satisfactorily
completed in another local education agency or shall provide
reasonable justification for denial. Should a waiver not be granted
to a student who would qualify to graduate from the sending school,
the local education agency shall use best efforts to provide an
alternative means of acquiring required coursework so that graduation
may occur on time.
   (B) Exit exams - States shall accept: 1) exit or end-of-course
exams required for graduation from the sending state; or 2) national
norm-referenced achievement tests; or 3) alternative testing, in lieu
of testing requirements for graduation in the receiving state; or 4)
in California, the passage of the exit examination adopted pursuant
to Section 60850 is required for the student to graduate if the
diploma is to be issued by a California public school, as long as it
is a requirement in California. In the event the above alternatives
cannot be accommodated by the receiving state for a student
transferring in his or her Senior year, then the provisions of
Section C of this Article shall apply.
   (C) Transfers during Senior year - Should a military student
transferring at the beginning or during his or her Senior year be
ineligible to graduate from the receiving local education agency
after all alternatives have been considered, the sending and
receiving local education agencies shall make best efforts to ensure
the receipt of a diploma from the sending local education agency, if
the student meets the graduation requirements of the sending local
education agency. In the event that one of the states in question is
not a member of this compact, the member state shall use best efforts
to facilitate the on-time graduation of the student in accordance
with Sections A and B of this Article.


   Article VIII.  State Coordination


   (A) (1) Each member state shall, through the creation of a State
Council or use of an existing body or board, provide for the
coordination among its agencies of government, local education
agencies and military installations concerning the state's
participation in, and compliance with, this compact and Interstate
Commission activities. While each member state may determine the
membership of its own State Council, its membership must include at
least: the state superintendent of education, superintendent of a
school district with a high concentration of military children,
representative from a military installation, one representative each
from the legislative and executive branches of government, and other
offices and stakeholder groups the State Council deems appropriate. A
member state that does not have a school district deemed to contain
a high concentration of military children may appoint a
superintendent from another school district to represent local
education agencies on the State Council.
   (2) In California, members of the State Council shall include all
of the following:
   (a) The State Superintendent of Public Instruction or his or her
designee.

   (b) A school district superintendent or his or her designee from a
school district with a high concentration of military children,
selected by the State Superintendent of Public Instruction.
   (c) A representative from a military installation.
   (d) A member of the Senate appointed by the Senate Committee on
Rules, or his or her designee, who represents a legislative district
with a high concentration of military children.
   (e) A member of the Assembly appointed by the Speaker of the
Assembly, or his or her designee, who represents a legislative
district with a high concentration of military children.
   (f) The Secretary for Education or his or her designee.
   (g) Any other persons appointed by the State Superintendent of
Public Instruction.
   (B) The State Council of each member state shall appoint or
designate a military family education liaison to assist military
families and the state in facilitating the implementation of this
compact.
   (C) (1) The compact commissioner responsible for the
administration and management of the state's participation in the
compact shall be appointed by the Governor or as otherwise determined
by each member state.
   (2) In California, the State Superintendent of Public Instruction
shall appoint the compact commissioner.
   (D) The compact commissioner and the military family education
liaison designated herein shall be ex-officio members of the State
Council, unless either is already a full voting member of the State
Council.


   Article IX.  Interstate Commission on Educational Opportunity for
Military Children


   The member states hereby create the "Interstate Commission on
Educational Opportunity for Military Children." The activities of the
Interstate Commission are the formation of public policy and are a
discretionary state function. The Interstate Commission shall:
   (A) Be a body corporate and joint agency of the member states and
shall have all the responsibilities, powers and duties set forth
herein, and such additional powers as may be conferred upon it by a
subsequent concurrent action of the respective legislatures of the
member states in accordance with the terms of this compact.
   (B) Consist of one Interstate Commission voting representative
from each member state, who shall be that state's compact
commissioner.
   (1) Each member state represented at a meeting of the Interstate
Commission is entitled to one vote.
   (2) A majority of the total member states shall constitute a
quorum for the transaction of business, unless a larger quorum is
required by the bylaws of the Interstate Commission.
   (3) A representative shall not delegate a vote to another member
state. In the event the compact commissioner is unable to attend a
meeting of the Interstate Commission, the Governor or State Council
may delegate voting authority to another person from their state for
a specified meeting.
   (4) The bylaws may provide for meetings of the Interstate
Commission to be conducted by telecommunication or electronic
communication.
   (C) Consist of ex-officio, nonvoting representatives who are
members of interested organizations. Such ex-officio members, as
defined in the bylaws, may include, but not be limited to, members of
the representative organizations of military family advocates, local
education agency officials, parent and teacher groups, the U.S.
Department of Defense, the Education Commission of the States, the
Interstate Agreement on the Qualification of Educational Personnel
and other interstate compacts affecting the education of children of
military members.
   (D) Meet at least once each calendar year. The chairperson may
call additional meetings and, upon the request of a simple majority
of the member states, shall call additional meetings.
   (E) Establish an executive committee, whose members shall include
the officers of the Interstate Commission and such other members of
the Interstate Commission as determined by the bylaws. Members of the
executive committee shall serve a one year term. Members of the
executive committee shall be entitled to one vote each. The executive
committee shall have the power to act on behalf of the Interstate
Commission, with the exception of rulemaking, during periods when the
Interstate Commission is not in session. The executive committee
shall oversee the day-to-day activities of the administration of the
compact, including enforcement and compliance with the provisions of
the compact, its bylaws and rules, and other such duties as deemed
necessary. The U.S. Dept. of Defense shall serve as an ex-officio,
nonvoting member of the executive committee.
   (F) Establish bylaws and rules that provide for conditions and
procedures under which the Interstate Commission shall make its
information and official records available to the public for
inspection or copying. The Interstate Commission may exempt from
disclosure information or official records to the extent they would
adversely affect personal privacy rights or proprietary interests.
   (G) Public notice shall be given by the Interstate Commission of
all meetings, and all meetings shall be open to the public, except as
set forth in the rules or as otherwise provided in the compact. The
Interstate Commission and its committees may close a meeting, or
portion thereof, where it determines by two-thirds vote that an open
meeting would be likely to:
   (1) Relate solely to the Interstate Commission's internal
personnel practices and procedures;
   (2) Disclose matters specifically exempted from disclosure by
federal and state statute;
   (3) Disclose trade secrets or commercial or financial information
which is privileged or confidential;
   (4) Involve accusing a person of a crime, or formally censuring a
person;
                         (5) Disclose information of a personal
nature where disclosure would constitute a clearly unwarranted
invasion of personal privacy;
   (6) Disclose investigative records compiled for law enforcement
purposes; or
   (7) Specifically relate to the Interstate Commission's
participation in a civil action or other legal proceeding.
   (H) For a meeting, or portion of a meeting, closed pursuant to
this provision, the Interstate Commission's legal counsel or designee
shall certify that the meeting may be closed and shall reference
each relevant exemptible provision. The Interstate Commission shall
keep minutes which shall fully and clearly describe all matters
discussed in a meeting and shall provide a full and accurate summary
of actions taken, and the reasons therefor, including a description
of the views expressed and the record of a roll call vote. All
documents considered in connection with an action shall be identified
in such minutes. All minutes and documents of a closed meeting shall
remain under seal, subject to release by a majority vote of the
Interstate Commission.
   (I) The Interstate Commission shall collect standardized data
concerning the educational transition of the children of military
families under this compact as directed through its rules which shall
specify the data to be collected, the means of collection and data
exchange and reporting requirements. Such methods of data collection,
exchange and reporting shall, in so far as is reasonably possible,
conform to current technology and coordinate its information
functions with the appropriate custodian of records as identified in
the bylaws and rules.
   (J) The Interstate Commission shall create a process that permits
military officials, education officials and parents to inform the
Interstate Commission if and when there are alleged violations of the
compact or its rules or when issues subject to the jurisdiction of
the compact or its rules are not addressed by the state or local
education agency. This section shall not be construed to create a
private right of action against the Interstate Commission or any
member state.


   Article X.  Powers and Duties of the Interstate Commission


   The Interstate Commission shall have the following powers:
   (A) To provide for dispute resolution among member states.
   (B) To promulgate rules and take all necessary actions to effect
the goals, purposes, and obligations as specifically set forth in
Articles IV, V, VI, and VII of this compact. The rules shall have the
force and effect of statutory law and shall be binding in the
compact states to the extent and in the manner provided in this
compact.
   (C) To issue, upon request of a member state, advisory opinions
concerning the meaning or interpretation of the interstate compact,
its bylaws, rules, and actions.
   (D) To enforce compliance with the compact provisions, the rules
promulgated by the Interstate Commission, and the bylaws, using all
necessary and proper means, including, but not limited to, the use of
judicial process.
   (E) To establish and maintain offices which shall be located
within one or more of the member states.
   (F) To purchase and maintain insurance and bonds.
   (G) To borrow, accept, hire, or contract for services of
personnel.
   (H) To establish and appoint committees including, but not limited
to, an executive committee as required by Article IX, Section E,
which shall have the power to act on behalf of the Interstate
Commission in carrying out its powers and duties hereunder.
   (I) To elect or appoint such officers, attorneys, employees,
agents, or consultants, and to fix their compensation, define their
duties and determine their qualifications, and to establish the
Interstate Commission's personnel policies and programs relating to
conflicts of interest, rates of compensation, and qualifications of
personnel.
   (J) To accept any and all donations and grants of money,
equipment, supplies, materials, and services, and to receive,
utilize, and dispose of it.
   (K) To lease, purchase, accept contributions or donations of, or
otherwise to own, hold, improve or use any property, real, personal,
or mixed.
   (L) To sell, convey, mortgage, pledge, lease, exchange, abandon,
or otherwise dispose of any property, real, personal, or mixed.
   (M) To establish a budget and make expenditures.
   (N) To adopt a seal and bylaws governing the management and
operation of the Interstate Commission.
   (O) To report annually to the legislatures, governors, judiciary,
and state councils of the member states concerning the activities of
the Interstate Commission during the preceding year. Such reports
shall also include any recommendations that may have been adopted by
the Interstate Commission.
   (P) To coordinate education, training, and public awareness
regarding the compact, its implementation and operation for officials
and parents involved in such activity.
   (Q) To establish uniform standards for the reporting, collecting,
and exchanging of data.
   (R) To maintain corporate books and records in accordance with the
bylaws.
   (S) To perform such functions as may be necessary or appropriate
to achieve the purposes of this compact.
   (T) To provide for the uniform collection and sharing of
information between and among member states, schools, and military
families under this compact.


   Article XI.  Organization and Operation of the Interstate
Commission


   (A) The Interstate Commission shall, by a majority of the members
present and voting, within 12 months after the first Interstate
Commission meeting, adopt bylaws to govern its conduct as may be
necessary or appropriate to carry out the purposes of the compact,
including, but not limited to:
   (1) Establishing the fiscal year of the Interstate Commission;
   (2) Establishing an executive committee, and such other committees
as may be necessary;
   (3) Providing for the establishment of committees and for
governing any general or specific delegation of authority or function
of the Interstate Commission;
   (4) Providing reasonable procedures for calling and conducting
meetings of the Interstate Commission, and ensuring reasonable notice
of each such meeting;
   (5) Establishing the titles and responsibilities of the officers
and staff of the Interstate Commission;
   (6) Providing a mechanism for concluding the operations of the
Interstate Commission and the return of surplus funds that may exist
upon the termination of the compact after the payment and reserving
of all of its debts and obligations.
   (7) Providing "start up" rules for initial administration of the
compact.
   (B) The Interstate Commission shall, by a majority of the members,
elect annually from among its members a chairperson, a
vice-chairperson, and a treasurer, each of whom shall have such
authority and duties as may be specified in the bylaws. The
chairperson or, in the chairperson's absence or disability, the
vice-chairperson, shall preside at all meetings of the Interstate
Commission. The officers so elected shall serve without compensation
or remuneration from the Interstate Commission; provided that,
subject to the availability of budgeted funds, the officers shall be
reimbursed for ordinary and necessary costs and expenses incurred by
them in the performance of their responsibilities as officers of the
Interstate Commission.
   (C) Executive Committee, Officers and Personnel
   (1) The executive committee shall have such authority and duties
as may be set forth in the bylaws, including, but not limited to:
   (a) Managing the affairs of the Interstate Commission in a manner
consistent with the bylaws and purposes of the Interstate Commission;

   (b) Overseeing an organizational structure within, and appropriate
procedures for the Interstate Commission to provide for the creation
of rules, operating procedures, and administrative and technical
support functions; and
   (c) Planning, implementing, and coordinating communications and
activities with other state, federal and local government
organizations in order to advance the goals of the Interstate
Commission.
   (2) The executive committee may, subject to the approval of the
Interstate Commission, appoint or retain an executive director for
such period, upon such terms and conditions and for such
compensation, as the Interstate Commission may deem appropriate. The
executive director shall serve as secretary to the Interstate
Commission, but shall not be a Member of the Interstate Commission.
The executive director shall hire and supervise such other persons as
may be authorized by the Interstate Commission.
   (D) The Interstate Commission's executive director and its
employees shall be immune from suit and liability, either personally
or in their official capacity, for a claim for damage to or loss of
property or personal injury or other civil liability caused or
arising out of or relating to an actual or alleged act, error, or
omission that occurred, or that such person had a reasonable basis
for believing occurred, within the scope of Interstate Commission
employment, duties, or responsibilities; provided, that such person
shall not be protected from suit or liability for damage, loss,
injury, or liability caused by the intentional or willful and wanton
misconduct of such person.
   (1) The liability of the Interstate Commission's executive
director and employees or Interstate Commission representatives,
acting within the scope of such person's employment or duties for
acts, errors, or omissions occurring within such person's state, may
not exceed the limits of liability set forth under the Constitution
and laws of that state for state officials, employees, and agents.
The Interstate Commission is considered to be an instrumentality of
the states for the purposes of any such action. Nothing in this
subsection shall be construed to protect such person from suit or
liability for damage, loss, injury, or liability caused by the
intentional or willful and wanton misconduct of such person.
   (2) The Interstate Commission shall defend the executive director
and its employees and, subject to the approval of the Attorney
General or other appropriate legal counsel of the member state
represented by an Interstate Commission representative, shall defend
such Interstate Commission representative in any civil action seeking
to impose liability arising out of an actual or alleged act, error
or omission that occurred within the scope of Interstate Commission
employment, duties or responsibilities, or that the defendant had a
reasonable basis for believing occurred within the scope of
Interstate Commission employment, duties, or responsibilities,
provided that the actual or alleged act, error, or omission did not
result from intentional or willful and wanton misconduct on the part
of such person.
   (3) To the extent not covered by the state involved, member state,
or the Interstate Commission, the representatives or employees of
the Interstate Commission shall be held harmless in the amount of a
settlement or judgment, including attorney's fees and costs, obtained
against such persons arising out of an actual or alleged act, error,
or omission that occurred within the scope of Interstate Commission
employment, duties, or responsibilities, or that such persons had a
reasonable basis for believing occurred within the scope of
Interstate Commission employment, duties, or responsibilities,
provided that the actual or alleged act, error, or omission did not
result from intentional or willfull and wanton misconduct on the part
of such persons.


   Article XII.  Rulemaking Functions of the Interstate Commission


   (A) Rulemaking Authority - The Interstate Commission shall
promulgate reasonable rules in order to effectively and efficiently
achieve the purposes of this compact, as specifically set forth in
Articles IV, V, VI, and VII. Notwithstanding the foregoing, in the
event the Interstate Commission exercises its rulemaking authority in
a manner that is beyond the scope of the specific matters set forth
in Articles IV, V, VI, and VII of this Act, or the powers granted
hereunder, then such an action by the Interstate Commission shall be
invalid and have no force or effect.
   (B) Rulemaking Procedure - Rules shall be made pursuant to a
rulemaking process that substantially conforms to the "Model State
Administrative Procedure Act," of 1981, Uniform Laws Annotated, Vol.
15, p.1 (2000) as amended, as may be appropriate to the operations of
the Interstate Commission.
   (C) Not later than thirty (30) days after a rule is promulgated,
any person may file a petition for judicial review of the rule;
provided, that the filing of such a petition shall not stay or
otherwise prevent the rule from becoming effective unless the court
finds that the petitioner has a substantial likelihood of success.
The court shall give deference to the actions of the Interstate
Commission consistent with applicable law and shall not find the rule
to be unlawful if the rule represents a reasonable exercise of the
Interstate Commission's authority.
   (D) If a majority of the legislatures of the compacting states
rejects a Rule by enactment of a statute or resolution in the same
manner used to adopt the compact, then such rule shall have no
further force and effect in any compacting state.


   Article XIII.  Oversight, Enforcement, and Dispute Resolution


   (A) Oversight
   (1) The executive, legislative and judicial branches of state
government in each member state shall enforce this compact, and shall
take all actions necessary and appropriate to effectuate the compact'
s purposes and intent. The provisions of this compact and the rules
promulgated hereunder shall have standing as statutory law.
   (2) All courts shall take judicial notice of the compact and the
rules in any judicial or administrative proceeding in a member state
pertaining to the subject matter of this compact which may affect the
powers, responsibilities or actions of the Interstate Commission.
   (3) The Interstate Commission shall be entitled to receive all
service of process in any such proceeding, and shall have standing to
intervene in the proceeding for all purposes. Failure to provide
service of process to the Interstate Commission shall render a
judgment or order void as to the Interstate Commission, this compact
or promulgated rules.
   (B) Default, Technical Assistance, Suspension and Termination - If
the Interstate Commission determines that a member state has
defaulted in the performance of its obligations or responsibilities
under this compact, or the bylaws or promulgated rules, the
Interstate Commission shall:
   (1) Provide written notice, to the defaulting state and other
member states, of the nature of the default, the means of curing the
default and any action taken by the Interstate Commission. The
Interstate Commission shall specify the conditions by which the
defaulting state must cure its default.
   (2) Provide remedial training and specific technical assistance
regarding the default.
   (3) If the defaulting state fails to cure the default, the
defaulting state shall be terminated from the compact upon an
affirmative vote of a majority of the member states and all rights,
privileges and benefits conferred by this compact shall be terminated
from the effective date of termination. A cure of the default does
not relieve the offending state of obligations or liabilities
incurred during the period of the default.
   (4) Suspension or termination of membership in the compact shall
be imposed only after all other means of securing compliance have
been exhausted. Notice of intent to suspend or terminate shall be
given by the Interstate Commission to the Governor, the majority and
minority leaders of the defaulting state's legislature, and each of
the member states.
   (5) The state which has been suspended or terminated is
responsible for all assessments, obligations and liabilities incurred
through the effective date of suspension or termination including
obligations, the performance of which extends beyond the effective
date of suspension or termination.
   (6) The Interstate Commission shall not bear any costs relating to
any state that has been found to be in default or which has been
suspended or terminated from the compact, unless otherwise mutually
agreed upon in writing between the Interstate Commission and the
defaulting state.
   (7) The defaulting state may appeal the action of the Interstate
Commission by petitioning the U.S. District Court for the District of
Columbia or the federal district where the Interstate Commission has
its principal offices. The prevailing party shall be awarded all
costs of such litigation including reasonable attorney's fees.
   (C) Dispute Resolution
   (1) The Interstate Commission shall attempt, upon the request of a
member state, to resolve disputes which are subject to the compact
and which may arise among member states and between member and
nonmember states.
   (2) The Interstate Commission shall promulgate a rule providing
for both mediation and binding dispute resolution for disputes as
appropriate.
   (D) Enforcement
   (1) The Interstate Commission, in the reasonable exercise of its
discretion, shall enforce the provisions and rules of this compact.
   (2) The Interstate Commission may, by majority vote of the
members, initiate legal action in the United States District Court
for the District of Columbia or, at the discretion of the Interstate
Commission, in the federal district where the Interstate Commission
has its principal offices, to enforce compliance with the provisions
of the compact or its promulgated rules and bylaws against a member
state in default. The relief sought may include both injunctive
relief and damages. In the event judicial enforcement is necessary,
the prevailing party shall be awarded all costs of such litigation
including reasonable attorney's fees.
   (3) The remedies herein shall not be the exclusive remedies of the
Interstate Commission. The Interstate Commission may avail itself of
any other remedies available under state law or the regulation of a
profession.


   Article XIV.  Financing of the Interstate Commission


   (A) The Interstate Commission shall pay, or provide for the
payment of, the reasonable expenses of its establishment,
organization and ongoing activities.
   (B) The Interstate Commission may levy on and collect an annual
assessment from each member state to cover the cost of the operations
and activities of the Interstate Commission and its staff which must
be in a total amount sufficient to cover the Interstate Commission's
annual budget as approved each year. The aggregate annual assessment
amount shall be allocated based upon a formula to be determined by
the Interstate Commission, which shall promulgate a rule binding upon
all member states.
   (C) The Interstate Commission shall not incur obligations of any
kind prior to securing the funds adequate to meet the same; nor shall
the Interstate Commission pledge the credit of any of the member
states, except by and with the authority of the member state.
   (D) The Interstate Commission shall keep accurate accounts of all
receipts and disbursements. The receipts and disbursements of the
Interstate Commission shall be subject to the audit and accounting
procedures established under its bylaws. However, all receipts and
disbursements of funds handled by the Interstate Commission shall be
audited yearly by a certified or licensed public accountant, and the
report of the audit shall be included in and become part of the
annual report of the Interstate Commission.


   Article XV.  Member, States, Effective Date and Amendment


   (A) Any state is eligible to become a member state.
   (B) The compact shall become effective and binding upon
legislative enactment of the compact into law by no less than ten
(10) of the states. The effective date shall be no earlier than
December 1, 2007. Thereafter it shall become effective and binding as
to any other member state upon enactment of the compact into law by
that state. The governors of non-member states or their designees
shall be invited to participate in the activities of the Interstate
Commission on a nonvoting basis prior to adoption of the compact by
all states.
   (C) The Interstate Commission may propose amendments to the
compact for enactment by the member states. No amendment shall become
effective and binding upon the Interstate Commission and the member
states unless and until it is enacted into law by unanimous consent
of the member states.


   Article XVI.  Withdrawal and Dissolution


   (A) Withdrawal
   (1) Once effective, the compact shall continue in force and remain
binding upon each and every member state; provided that a member
state may withdraw from the compact by specifically repealing the
statute which enacted the compact into law.
   (2) Withdrawal from this compact shall be by the enactment of a
statute repealing the same, but shall not take effect until one (1)
year after the effective date of such statute and until written
notice of the withdrawal has been given by the withdrawing state to
the Governor of each other member jurisdiction.
   (3) The withdrawing state shall immediately notify the chairperson
of the Interstate Commission in writing upon the introduction of
legislation repealing this compact in the withdrawing state. The
Interstate Commission shall notify the other member states of the
withdrawing state's intent to withdraw within sixty (60) days of its
receipt thereof.
   (4) The withdrawing state is responsible for all assessments,
obligations and liabilities incurred through the effective date of
withdrawal, including obligations, the performance of which extend
beyond the effective date of withdrawal.
   (5) Reinstatement following withdrawal of a member state shall
occur upon the withdrawing state reenacting the compact or upon such
later date as determined by the Interstate Commission.
   (B) Dissolution of Compact
   (1) This compact shall dissolve effective upon the date of the
withdrawal or default of the member state which reduces the
membership in the compact to one (1) member state.
   (2) Upon the dissolution of this compact, the compact becomes null
and void and shall be of no further force or effect, and the
business and affairs of the Interstate Commission shall be concluded
and surplus funds shall be distributed in accordance with the bylaws.


   Article XVII.  Severability and Construction


   (A) The provisions of this compact shall be severable, and if any
phrase, clause, sentence or provision is deemed unenforceable, the
remaining provisions of the compact shall be enforceable.
   (B) The provisions of this compact shall be liberally construed to
effectuate its purposes.
   (C) Nothing in this compact shall be construed to prohibit the
applicability of other interstate compacts to which the states are
members.


   Article XVIII.  Binding Effect of Compact and Other Laws


   (A) Other Laws
   (1) Nothing herein prevents the enforcement of any other law of a
member state that is not inconsistent with this compact.
   (2) All member states' laws conflicting with this compact are
superseded to the extent of the conflict.
   (B) Binding Effect of the Compact
   (1) All lawful actions of the Interstate Commission, including all
rules and bylaws promulgated by the Interstate Commission, are
binding upon the member states.
   (2) All agreements between the Interstate Commission and the
member states are binding in accordance with their terms.
   (3) In the event any provision of this compact exceeds the
constitutional limits imposed on the legislature of any member state,
such provision shall be ineffective to the extent of the conflict
with the constitutional provision in question in that member state.
  SEC. 45.  Section 51241 of the Education Code, as amended by
Section 55 of Chapter 140 of the Statutes of 2009, is repealed.
  SEC. 46.  Section 52055.770 of the Education Code is amended to
read:
   52055.770.  (a) School districts and chartering authorities shall
receive funding at the following rate, on behalf of funded schools:
   (1) For kindergarten and grades 1 to 3, inclusive, five hundred
dollars ($500) per enrolled pupil in funded schools.
   (2) For grades 4 to 8, inclusive, nine hundred dollars ($900) per
enrolled pupil in funded schools.
   (3) For grades 9 to 12, inclusive, one thousand dollars ($1,000)
per enrolled pupil in funded schools.
   (b) For purposes of subdivision (a), enrollment of a pupil in a
funded school in the prior fiscal year shall be based on data from
the CBEDS. For the 2007-08 fiscal year, the funded rates shall be
reduced to reflect the percentage difference in the total amounts
appropriated for purposes of this section in that year compared to
the amounts appropriated for purposes of this section in the 2008-09
fiscal year.
   (c) The following amounts are hereby appropriated from the General
Fund for the purposes set forth in subdivision (f):
   (1) For the 2007-08 fiscal year, three hundred million dollars
($300,000,000), to be allocated as follows:
   (A) Thirty-two million dollars ($32,000,000) for transfer by the
Controller to Section B of the State School Fund for allocation by
the Chancellor of the California Community Colleges to community
colleges for the purpose of providing funding to the community
colleges to improve and expand career technical education in public
secondary education and lower division public higher education
pursuant to Section 88532, including the hiring of additional faculty
to expand the number of career technical education programs and
course offerings.
   (B) Two hundred sixty-eight million dollars ($268,000,000) for
transfer by the Controller to Section A of the State School Fund for
allocation by the Superintendent pursuant to this article.
   (2) For each of the 2008-09, and 2010-11 to 2014-15 fiscal years,
inclusive, four hundred fifty million dollars ($450,000,000) per
fiscal year, to be allocated as follows:
   (A) Forty-eight million dollars ($48,000,000) for transfer by the
Controller to Section B of the State School Fund for allocation by
the Chancellor of the California Community Colleges to community
colleges as required under subdivision (e).
   (B) Four hundred two million dollars ($402,000,000) for transfer
by the Controller to Section A of the State School Fund for
allocation by the Superintendent pursuant to this article.
   (C) Commencing with the 2010-11 fiscal year, payments made
pursuant to subparagraphs (A) and (B) shall be made only on or after
October 8 of each fiscal year.
     (d) For the 2013-14 fiscal year the amounts appropriated under
subdivision (c) shall be adjusted to reflect the total fiscal
settlement agreed to by the parties in California Teachers
Association, et al. v. Arnold Schwarzenegger (Case Number 05CS01165
of the Superior Court for the County of Sacramento) and the sum of
all fiscal years of funding provided to fund this article shall not
exceed the total funds agreed to by those parties. This annual
appropriation shall continue to be made until the Director of Finance
reports to the Legislature, along with all proposed adjustments to
the Governor's Budget pursuant to Section 13308 of the Government
Code, that the sum of appropriations made and allocated pursuant to
subdivision (c) equals the total outstanding balance of the minimum
state educational funding obligation to school districts and
community college districts required by Section 8 of Article XVI of
the California Constitution and Chapter 213 of the Statutes of 2004
for the 2004-05 and 2005-06 fiscal years, as determined in
subdivision (a) or (b) of Section 41207.1.
   (e) The sum transferred under subparagraph (A) of paragraph (2) of
subdivision (c) for the 2008-09 fiscal year shall be allocated by
the Chancellor of the California Community Colleges as follows:
   (1) Thirty-eight million dollars ($38,000,000) to the community
colleges for the purpose of providing funding to the community
colleges to improve and expand career technical education in public
secondary education and lower division public higher education
pursuant to Section 88532, including the hiring of additional faculty
to expand the number of career technical education programs and
course offerings.
   (2) Ten million dollars ($10,000,000) to the community colleges
for the purpose of providing one-time block grants to community
college districts to be used for one-time items of expenditure,
including, but not limited to, the following purposes:
   (A) Physical plant, scheduled maintenance, deferred maintenance,
and special repairs.
   (B) Instructional materials and support.
   (C) Instructional equipment, including equipment related to career
technical education, with priority for nursing program equipment.
   (D) Library materials.
   (E) Technology infrastructure.
   (F) Hazardous substances abatement, cleanup, and repair.
   (G) Architectural barrier removal.
   (H) State-mandated local programs.
   (3) The Chancellor of the California Community Colleges shall
allocate the amount allocated pursuant to paragraph (2) to community
college districts on an equal amount per actual full-time equivalent
student (FTES) reported for the prior fiscal year, except that each
community college district shall be allocated an amount not less than
fifty thousand dollars ($50,000), and the equal amount per unit of
FTES shall be computed accordingly.
   (4) Funds allocated under paragraph (2) shall supplement and not
supplant existing expenditures and may not be counted as the district
contribution for physical plant projects and instructional material
purchases funded in Item 6870-101-0001 of Section 2.00 of the annual
Budget Act.
   (f) For each fiscal year, commencing with the 2010-11 fiscal year,
to the 2014-15 fiscal year, inclusive, the sum transferred pursuant
to subparagraph (A) of paragraph (2) of subdivision (c) shall be
allocated by the Chancellor of the California Community Colleges as
follows: Forty-eight million dollars ($48,000,000) to the community
colleges for the purpose of providing funding to the community
colleges to improve and expand career technical education in public
secondary education and lower division public higher education
pursuant to Section 88532, including the hiring of additional faculty
to expand the number of career technical education programs and
course offerings.
   (g) The appropriations made under subdivision (c) are for the
purpose of discharging in full the minimum state educational funding
obligation to school districts and community college districts
pursuant to Section 8 of Article XVI of the California Constitution
and Chapter 213 of the Statutes of 2004 for the 2004-05 fiscal year,
and the outstanding maintenance factor for the 2005-06 fiscal year
resulting from this additional payment of the Chapter 213 amount for
the 2004-05 fiscal year.
   (h) For the purposes of making the computations required by
Section 8 of Article XVI of the California Constitution, including
computation of the state's minimum funding obligation to school
districts and community college districts in subsequent fiscal years,
the first one billion six hundred twenty million nine hundred
twenty-eight thousand dollars ($1,620,928,000) in appropriations made
pursuant to subdivision (c) shall be deemed to be "General Fund
revenues appropriated for school districts," as defined in
subdivision (c) of Section 41202 and "General Fund revenues
appropriated for community college districts," as defined in
subdivision (d) of Section 41202, for the 2004-05 fiscal year and
included within the "total allocations to school districts and
community college districts from General Fund proceeds of taxes
appropriated pursuant to Article XIII B," as defined in subdivision
(e) of Section 41202, for that fiscal year. The remaining
appropriations made pursuant to subdivision (c) shall be deemed to be
"General Fund revenues appropriated for school districts," as
defined in subdivision (c) of Section 41202 and "General Fund
revenues appropriated for community college districts," as defined in
subdivision (d) of Section 41202, for the 2005-06 fiscal year and
included within the "total allocations to school districts and
community college districts from General Fund proceeds of taxes
appropriated pursuant to Article XIII B," as defined in subdivision
(e) of Section 41202, for that fiscal year.
   (i) From funds appropriated under subdivision (c), the
Superintendent shall provide both of the following:
   (1) Not more than two million dollars ($2,000,000) annually to
county superintendents of schools to carry out the requirements of
this article, allocated in a manner similar to that created to carry
out the new duties of those superintendents under the settlement
agreement in the case of Williams v. California (Super. Ct. San
Francisco, No. CGC-00-312236).
   (2) Five million dollars ($5,000,000) in the 2007-08 fiscal year
to support regional assistance under Section 52055.730. It is the
intent of the Legislature that the Superintendent and the secretary,
along with county offices of education, seek foundational and other
financial support to sustain and expand these services. Funds
provided under this paragraph that are not expended in the 2007-08
fiscal year shall be reappropriated for use in subsequent fiscal
years for the same purpose.
   (j) Notwithstanding any other provision of law, funds appropriated
under subdivision (c) but not allocated to schools with kindergarten
or grades 1 to 12, inclusive, in a fiscal year, due to program
termination in any year or otherwise, shall be available for
reappropriation only in furtherance of the purposes of this article.
First priority for those amounts shall be to provide cost-of-living
increases and enrollment growth adjustments to funded schools.
   (k) The sum of three hundred fifty thousand dollars ($350,000) is
hereby appropriated from the General Fund to the State Department of
Education to fund 3.0 positions to implement this article. Funding
provided under this subdivision is not part of funds provided
pursuant to subdivision (c).
  SEC. 47.  Section 52165 of the Education Code is amended to read:
   52165.  Each pupil of limited English proficiency enrolled in the
California public school system in kindergarten and grades 1 to 12,
inclusive, shall receive instruction in a language understandable to
the pupil that recognizes the pupil's primary language and teaches
the pupil English.
   (a) In kindergarten and grades 1 to 6, inclusive, the following
shall apply:
   (1) If the language census indicates that any school of a school
district has 10 or more pupils of limited English proficiency with
the same primary language in the same grade level or 10 or more
pupils of limited English proficiency with the same primary language,
in the same age group, and in a multigrade or ungraded instructional
environment, the school district shall offer instruction pursuant to
subdivision (a), (b), or (c) of Section 52163 for those pupils at
the school. If there are pupils of limited English proficiency with
different primary languages who do not otherwise satisfy the program
requirements of subdivision (a), (b), or (c) of Section 52163 or of
this subdivision, a language development specialist defined in
subdivision (b) may be used.
   (2) To the extent state or federal categorical funds are
available, the services, as described in this paragraph, are required
for pupils of limited English proficiency in concentrations of fewer
than 10 per grade level. If there are fewer than 10 pupils of
limited English proficiency in the same grade, but at least 20 pupils
of limited English proficiency in the school with the same primary
language, the school district shall provide at least one certified
bilingual-crosscultural teacher or teachers on waiver as defined in
Section 52178 and an elementary level individual learning program as
defined in subdivision (f) of Section 52163 for those pupils at the
school. If the number of pupils of limited English proficiency in the
school exceeds 45, the district shall provide two of those teachers.
These teachers may be used as resource teachers or team teachers or
to provide any other services to pupils of limited English
proficiency as the district deems appropriate. These teachers shall
be different teachers than those required pursuant to paragraph (1).
   (b) The Legislature recognizes that in the past equal educational
opportunities have not been fully available to secondary pupils of
limited English proficiency. It is the intent of the Legislature to
encourage school districts to offer a language learning program
pursuant to subdivision (d) of Section 52163. Certified
bilingual-crosscultural teachers or, if those teachers are not
available, language development specialists assisted by a bilingual
aide shall be qualified to provide instruction for those programs.
Language development specialists shall be formally trained and
competent in the field of English language learning, including second
language acquisition and development, structure of modern English,
and basic principles of linguistics, and shall meet the culture and
methodology competencies established by subdivisions (b) and (c) of
Section 44253.5. The Commission on Teacher Credentialing shall
provide for the assessment of language competencies specified in this
section and shall modify existing culture and methodology competency
for language development specialist to ensure that they meet the
crosscultural and instructional methodologies for pupils being served
by those teachers. A teacher of English to speakers of other
languages certificate from a commission-approved teacher training
institution of higher education that meets the criteria established
by the commission pursuant to Section 44253.5 shall be accepted
instead of the methodology requirement.
   (c) In kindergarten and grades 1 to 12, inclusive, pupils of
limited English proficiency who are not enrolled in a program
described in subdivision (a), (b), (c), or (d) of Section 52163 shall
be individually evaluated and shall receive educational services
defined in subdivision (e) or (f), as appropriate, of Section 52163.
These services shall be provided in consultation with the pupil and
the parent, parents, or guardian of the pupil.
   (d) As a part of its consolidated application for categorical
program funds, each district receiving those funds shall include a
specific plan indicating the ways in which the individual learning
plans will meet the needs of pupils of limited English proficiency.
The plan shall describe all of the following:
   (1) Procedures used in making the individual evaluation.
   (2) The pupils' levels of English and primary language proficiency
and levels of educational performance.
   (3) Instructional objectives and scope of educational services to
be provided.
   (4) Periodic evaluation procedures, using objective criteria, to
determine whether the instructional objectives are being met.
  SEC. 48.  Section 53302 of the Education Code is amended to read:
   53302.  (a) No more than 75 schools shall be subject to a petition
authorized by this article.
   (b) A petition shall be counted toward this limit upon the
Superintendent and state board receiving notice from the local
educational agency of its final disposition of the petition.
  SEC. 49.  Section 60852.3 of the Education Code is amended to read:

   60852.3.  (a) Notwithstanding any other provision of law,
commencing with the 2009-10 school year, an eligible pupil with a
disability is not required to pass the high school exit examination
established pursuant to Section 60850 as a condition of receiving a
diploma of graduation or as a condition of graduation from high
school.
   (b) This exemption shall last until the state board, pursuant to
Section 60852.1, makes a determination that the alternative means by
which an eligible pupil with disabilities may demonstrate the same
level of academic achievement in the portions of, or those content
standards required for passage of, the high school exit examination
are not feasible or that the alternative means are implemented.
   (c) For the purposes of this section, an eligible pupil with a
disability is a pupil with an individualized education program
adopted pursuant to the federal Individuals with Disabilities
Education Act (20 U.S.C. Sec. 1400 et seq.) or a plan adopted
pursuant to Section 504 of the federal Rehabilitation Act of 1973 (29
U.S.C. Sec. 794(a)) that indicates the pupil is scheduled to receive
a high school diploma, and that the pupil has satisfied or will
satisfy all other state and local requirements for the receipt of a
high school diploma, on or after July 1, 2009.
   (d) A local educational agency, as defined in Section 56026.3,
shall not adopt an individualized education program pursuant to the
federal Individuals with Disabilities Education Act or a plan
pursuant to Section 504 of the federal Rehabilitation Act of 1973 for
a pupil for the sole purpose of exempting the pupil from the
requirement to pass the high school exit examination as a condition
of receiving a high school diploma, unless that adoption is
consistent with federal law.
   (e) Pursuant to subdivision (b) of Section 60851, pupils with
exceptional needs shall take the high school exit examination in
grade 10 for purposes of fulfilling the requirements of the federal
No Child Left Behind Act of 2001 (20 U.S.C. Sec. 7114).
  SEC. 50.  Section 67302.5 of the Education Code is amended to read:

   67302.5.  (a) As used in this section, the following terms have
the following meanings:
   (1) "Captioned" or "captioning" means the display of text
corresponding to, and synchronized with, the spoken-word audio
portion of instructional material.
   (2) "Electronic format" means a computer file or other digital
medium that embodies instructional material, is not itself captioned,
but from which a captioned format may be created using commercially
available technology.
   (3) "Institution" means the University of California, the
California State University, a California Community College, or any
campus or location of any of those institutions.
   (4) "Instructional material" means any audiovisual work, as that
term is defined in Section 101 of Title 17 of the United States Code,
that is created and published primarily for use by students in
postsecondary instruction, and is required for a student's success in
a course of study in which a student with a disability is enrolled.
The determination of which materials are "required for student
success" shall be made by the instructor of the course in
consultation with the official making the request pursuant to
subdivision (b) in accordance with guidelines issued pursuant to
subdivision (i).
   (5) "Publisher" means any individual, firm, partnership, or
corporation that is engaged in the business, whether for profit or
not for profit, of selling instructional material in which it owns or
controls some or all of the copyright to that material. "Publisher"
does not include any entity that is a subdivision of any state or
other governmental body, other than the State of California.
   (6) "Writing" includes facsimile transmission and e-mail.
   (b) (1) A publisher that publishes instructional material used by
students attending, or by instructors for use in classroom
presentations at, the University of California, the California State
University, or a California Community College, shall, upon request by
an institution on behalf of a student or instructor at that
institution, do one of the following:
   (A) Provide access to a captioned format of the instructional
material directly to the student or the instructor by providing an
Internet password, delivery of a disk or file, or in any other
appropriate manner.
   (B) Provide to the institution a captioned format of the
instructional material.
   (C) Provide to the institution an electronic format, if available,
of the instructional material, unless the institution already has an
electronic format in its possession, and a license permitting the
institution to create a captioned format of the material, to the
extent the publisher has the right to grant that license.
   (2) A publisher shall respond to a properly addressed request that
meets the requirements of subdivision (c) in the following manner,
as applicable:
   (A) Within 10 calendar days after the receipt of the request, the
publisher shall provide to the institution a notice, in writing, as
to which of the three actions in paragraph (1) it intends to take.
   (B) If the publisher does not possess an electronic format of the
instructional material, it shall advise the institution of that fact
in the notice provided pursuant to subparagraph (A).
   (C) If the publisher lacks sufficient rights to distribute, or
license the institution to create, a captioned format of some or all
of the instructional material covered by the request, it shall advise
the institution of that fact in the notice provided pursuant to
subparagraph (A), and shall provide both of the following to the
institution, to the extent that the publisher is able to do so:
   (i) An electronic format of the instructional material to which
the publisher does not control the applicable rights.
   (ii) The name and contact information of the person that the
publisher believes to be capable of authorizing creation of a
captioned format of the instructional material. Any person capable of
authorizing the creation of the captioned format shall be deemed to
be the publisher of that material for purposes of this section.
   (D) If the publisher notifies the institution that it will provide
an electronic format and a license permitting the institution to
create a captioned format, it shall provide the electronic format and
the license within seven calendar days of providing the notice
pursuant to subparagraph (A).
   (E) If the publisher notifies the institution that it will provide
a captioned format of the requested material, the publisher shall
provide the captioned format as soon as it is possible to do so, but
not later than 14 calendar days after providing the notice pursuant
to subparagraph (A).
   (3) If a publisher fails to respond to a request, as required by
paragraph (2), within 10 calendar days of receiving the request, the
institution shall be deemed to have received a license permitting the
institution to create a captioned format of the instructional
material.
   (c) (1) An institution, if it chooses to submit a request pursuant
to subdivision (b), shall include in the request all of the
following:
   (A) Certification that the institution or an instructor at that
institution has purchased the instructional material either (i) for
use by a student with an auditory disability that prevents the
student from using the instructional material in a noncaptioned
format or (ii) for use in a class in which a student with such a
disability is enrolled, or that a student with such a disability
attending, or registered to attend, that institution has purchased
the instructional material.
   (B) Certification that the student has an auditory disability that
prevents the student from using instructional material in
noncaptioned format.
   (C) Certification that the instructional material is for use by
the student or an instructor in connection with a course in which the
student is registered or enrolled at the institution.
   (D) The signature of the coordinator of services for students with
disabilities at the institution, or by an official responsible for
monitoring compliance with the Americans with Disabilities Act of
1990 (42 U.S.C. 12101 et seq.) at the institution.
   (E) At a minimum, an e-mail address and a facsimile number at
which the person signing the request may be contacted.
   (2) A publisher may require, in addition to the requirements
enumerated in paragraph (1), a request to include a statement signed
by the student agreeing to both of the following:
   (A) He or she will use the captioned format of the instructional
material solely for his or her own educational purposes.
   (B) He or she will not distribute or reproduce the captioned
format for use by others.
   (d) (1) Any institution possessing an electronic format of an
instructional material shall take reasonable precautions to ensure
that the electronic format is not distributed to any third party,
except as provided in paragraph (2) and subdivision (e), and shall,
to the extent possible, maintain in effect all copy-protection
measures embedded in any electronic format provided by a publisher.
   (2) An institution may retain an outside vendor to assist it in
the exercise of rights granted to it by a publisher or by this
section, and shall ensure, pursuant to an agreement that the
publisher and the institution shall both have the power to enforce,
that the electronic format is not further distributed and that any
captioned format made from it is provided only to the institution.
   (e) (1) If a publisher provides to an institution a captioned
format of instructional materials, the institution shall provide the
captioned format to the student or instructor on whose behalf the
request was made and may retain a copy of that captioned format.
   (2) Except as provided in paragraph (4), if a publisher grants an
institution a license to create a captioned format, the institution
shall provide a copy of the resulting captioned format to the
publisher and may retain a copy of the captioned format.
   (3) Pursuant to paragraph (1) or (2), the institution may provide
additional copies to any other of its students, any instructor
employed by the institution for classroom use, any student at any
other institution, or any other institution for classroom use, if the
institution collects and forwards to the publisher all institutional
and student certifications required under subdivision (b).
   (4) The institution shall cease to distribute additional copies of
a captioned format to any other institution if either of the
following occurs:
   (A) The institution receives notice that a captioned format has
become commercially available from the publisher or other copyright
owner of the instructional material. However, if this occurs, the
institution may continue to allow its own instructors to use any
captioned format that the institution previously created.
   (B) The publisher, or other copyright owner, of the instructional
material notifies the institution that the institution's captioned
format contains material errors or omissions.
   (5) An instructor who receives a captioned format, or access to a
captioned format pursuant to subparagraph (A) of paragraph (1) of
subdivision (b), shall not use the captioned format for any purposes
except for the classroom use for which the captioned format was
requested or, in accordance with paragraph (3), for use in other
classes at the institution with which the instructor is affiliated at
the time that a request was made pursuant to subdivision (b).
   (f) (1) The Chancellor of the California Community Colleges, the
Chancellor of the California State University, and the President of
the University of California may each designate an office, or may by
agreement designate a single office, to maintain a registry of
publisher contact information. A registry office designated pursuant
to this subdivision may be a center described in subdivision (g) of
this section or subdivision (g) of Section 67302.
   (2) A publisher intending to sell instructional materials in the
state shall provide to the office designated pursuant to paragraph
(1) the name and contact information of its office or employee
designated to handle requests made under this section, or an Internet
Web site containing that information. If a publisher fails to
provide that information, a request under subdivision (b) may be sent
to a publisher at the address of its primary place of business, to
the attention of its rights and permissions department.
   (g) The Chancellor of the California Community Colleges, the
Chancellor of the California State University, and the President of
the University of California may each establish one or more centers
within their respective segments to process requests pursuant to this
section. A center under this subdivision may be a center established
under subdivision (g) of Section 67302. All of the following
requirements apply with respect to any center established or
designated for the purposes of this subdivision:
   (1) If an institution designated as within the jurisdiction of a
center chooses to process requests in the manner set forth in this
subdivision, it shall submit all requests made under this section to
the center, which shall transmit these requests to publishers.
   (2) Each center shall make every effort to coordinate requests
within its segment.
   (3) A publisher shall not be required to respond to requests from
institutions that a center has been designated to represent, unless
those requests are communicated through the center.
   (4) The center shall, in handling all electronic formats and
captioned formats for the benefit of students enrolled in the
institutions the center represents, have the same rights and
obligations arising under subdivisions (d) and (e) as the
institutions on whose behalf it acts.
                                                              (h)
Access to a captioned format, an electronic format, or a license to
create a captioned format pursuant to subdivision (b) shall be
provided free of any fee or royalty that is additional to the initial
purchase of the instructional material by the student, the
instructor, or the institution.
   (i) (1) The Board of Governors of the California Community
Colleges and the Trustees of the California State University may, and
the Regents of the University of California are requested to, adopt
guidelines consistent with this section for its implementation and
administration. It is the intent of the Legislature that the
guidelines, if adopted, address all of the following:
   (A) The designation of materials deemed "required for student
success."
   (B) The procedures and standards relating to distribution of files
and materials pursuant to subdivisions (b), (d), and (e).
   (C) The possibility of involving outside networks or partnerships
between publishers and institutions to provide for access to
instructional materials for students with disabilities and to
facilitate the issuance of licenses by publishers under subparagraph
(C) of paragraph (1), and paragraph (3), of subdivision (b).
   (D) Other matters as are deemed necessary or appropriate to carry
out the purposes of this section.
   (2) For purposes of paragraph (1), the Board of Governors of the
California Community Colleges, the Trustees of the California State
University, and the University of California are encouraged, from
time to time, in the reasonable discretion of the respective
governing body, to convene an advisory group, at least one-third of
the membership of which shall be representatives designated by
publishers as having a substantial volume of transactions with
institutions under this section.
   (j) Nothing in this section shall be construed to require a
publisher to produce or deliver an electronic format of instructional
material if the publisher offers that instructional material for
sale only in a form that is not computer-readable.
   (k) Nothing in this section shall be construed as vesting any
copyright or copyright interest in any captioned format in any person
or entity other than the publisher.
   (l) Nothing in this section shall be construed to authorize any
use of instructional materials that would violate the takings clause
of the Fifth Amendment to the United States Constitution or would
constitute an infringement of copyright under the Copyright Revision
Act of 1976, as amended (17 U.S.C. Sec. 101 et seq.).
   (m) This section exclusively governs requests for captioned
formats of instructional materials and Section 67302 does not apply
to requests for captioned formats of instructional materials.
   (n) The provisions of this section shall apply to the University
of California, the California State University, and the California
Community Colleges only to the extent that the respective
institution, by appropriate resolution, makes these provisions
applicable.
  SEC. 51.  Section 69458 of the Education Code is amended to read:
   69458.  (a) Participation in the pilot alternative delivery system
pursuant to this article is voluntary. Any local agency electing to
participate in the pilot alternative delivery system is deemed to
have acknowledged and agreed that its participation is voluntary and
does not constitute a cost that is reimbursable under Part 7
(commencing with Section 17500) of Division 4 of Title 2 of the
Government Code.
   (b) All costs associated with a qualifying institution's election
to participate in the pilot alternative delivery system shall be paid
by the qualifying institution and, if the qualifying institution is
a public institution, shall not require any additional state funds.
  SEC. 52.  Section 69460 of the Education Code is amended to read:
   69460.  (a) On or before January 10, 2012, the Legislative Analyst'
s Office shall report to the Legislature and the Governor on the
implementation and outcomes of the first award cycle under the pilot
program. The report shall assess the extent to which the pilot
program resulted in improved Cal Grant delivery to students, parents,
and high school and financial aid counselors; administrative
efficiencies; and sufficient state oversight. The report shall also
identify any challenges or barriers to expansion of the alternative
Cal Grant delivery system, as well as any associated information
technology challenges that may need to be addressed or changes that
may be required.
   (b) Consistent with the criteria in subdivision (a), the Student
Aid Commission may provide a report to the Legislature and the
Governor.
  SEC. 53.  Section 69613 of the Education Code is amended to read:
   69613.  (a) Program participants shall meet all of the following
eligibility criteria prior to selection in the program and shall
continue to meet these criteria, as appropriate, during the payment
periods:
   (1) The applicant has completed at least 60 semester units, or the
equivalent, and is enrolled in an academic program leading to a
baccalaureate degree at an eligible institution, has agreed to
participate in a teacher internship program, or has been admitted to
a program of professional preparation that has been approved by the
Commission on Teacher Credentialing.
   (2) The applicant is currently enrolled in, or has been admitted
to, a program in which he or she will be enrolled on at least a
half-time basis, as determined by the participating institution. The
applicant shall agree to maintain satisfactory academic progress and
a minimum of half-time enrollment, as defined by the participating
eligible institution.
   (A) Except as provided in subparagraphs (B) and (C), if a person
participating in the program fails to maintain at least half-time
enrollment, as required by this article, under the terms of the
agreement pursuant to paragraph (2), the loan assumption agreement
shall be invalidated and the participant shall retain full liability
for all student loan obligations. This subparagraph shall not apply
if the participant is in his or her final semester or quarter in
school and has no additional coursework required to obtain his or her
teaching credential.
   (B) Notwithstanding subparagraph (A), if a program participant is
unable to maintain at least half-time enrollment due to serious
illness, pregnancy, or other natural causes, or is called to active
military duty status, the participant is not required to retain full
liability for the student loan obligation for a period not to exceed
one calendar year, unless approved by the commission for a longer
period.
   (C) If a natural disaster prevents a program participant from
maintaining at least half-time enrollment due to the interruption of
instruction at the eligible institution, the term of the loan
assumption agreement shall be extended for a period not to exceed one
calendar year, unless approved by the commission for a longer
period.
   (3) The applicant has been judged by his or her postsecondary
institution, school district, or county office of education to have
outstanding ability on the basis of criteria that may include, but
need not be limited to, any of the following:
   (A) Grade point average.
   (B) Test scores.
   (C) Faculty evaluations.
   (D) Interviews.
   (E) Other recommendations.
   (4) The applicant has received, or is approved to receive, a loan
under one or more of the following designated loan programs:
   (A) The Federal Family Education Loan Program (20 U.S.C. Sec. 1071
et seq.).
   (B) Any educational loan program approved by the Student Aid
Commission.
   (5) The applicant has agreed to teach full time for at least four
consecutive academic years, or on a part-time basis for the
equivalent of four full-time academic years, after obtaining a
teaching credential in a public elementary or secondary school in
this state, in a subject area that is designated as a current or
projected shortage area by the Superintendent of Public Instruction,
or, on the date the teacher is hired, at an eligible school.
   (b) An agreement shall remain valid even if the subject area under
which an applicant becomes eligible to enter into an agreement
ceases to be a designated shortage field by the time the applicant
becomes a teacher.
   (c) For the purposes of calculating eligible years of teaching for
the redemption of an award, the inclusion by the Superintendent of
Public Instruction of a school on a list prepared pursuant to Section
69613.1 shall apply retroactively from the date the school first
opened.
   (d) A person participating in the program pursuant to this section
shall not enter into more than one agreement.
   (e) A person participating in the program pursuant to this section
shall not owe a refund on any state or federal educational grant or
have defaulted on any student loan.
   (f) Notwithstanding any other provision of this section, a
credentialed teacher teaching in a public school ranked in the lowest
two deciles on the Academic Performance Index pursuant to Section
52052, possesses a clear multiple subject or single subject teaching
credential or level II education specialist credential and who has
not otherwise participated in the program established by this
article, is eligible to enter into an agreement for loan assumption
pursuant to this article. The number of loan assumption agreements
provided pursuant to this subdivision shall not exceed 400 per year.
The commission shall develop and adopt regulations for the
implementation of this subdivision by January 1, 2010.
  SEC. 54.  Section 69999.14 of the Education Code is amended to
read:
   69999.14.  (a) The Legislature finds and declares all of the
following:
   (1) The California National Guard exists to provide a military
organization in California with the capability to protect the lives
and property of the people of the state during periods of natural
disaster and civil disturbances, and to perform other functions
required by the Military and Veterans Code or as directed by the
Governor.
   (2) The California National Guard performs an essential public
purpose in protecting the health, safety, and property of California'
s citizens and, in order to fulfill its objectives, it is necessary
for the California National Guard to have sufficient human resources
to deal with natural or human-caused disasters and emergencies.
   (3) An educational assistance award program for members of the
California National Guard would enhance retention rates within the
California National Guard. Similar educational assistance programs
have been highly successful in other states and have resulted in
substantially higher retention rates.
   (b) (1) As citizen soldiers, members of the California National
Guard represent California's labor force, which is a diverse
workforce comprised of skilled and talented workers from all regions
of the state. Education assistance awards have the added benefit of
improving the skills, competencies, and abilities of the servicemen
and servicewomen in the California National Guard who make
significant contributions to our economy and are a vital component of
the civilian workforce. It is the intent of the Legislature that
members of the California National Guard use this education
assistance program to enhance the state's highly skilled and highly
trained civilian labor force.
   (2) It is the intent of the Legislature to ensure that the
California National Guard has the ability to retain its most
competent and capable members, both in the present and in the future.
The Legislature recognizes that every member of the California
National Guard represents additional federal funding to the State of
California annually. Increasing the strength of the California
National Guard through higher retention rates would augment the total
federal revenue to the state, leading to additional money flowing
into the General Fund as tax revenue.
   (c) It is, therefore, the intent of the Legislature that, in order
to fulfill the public program of maintaining required strength in
the California National Guard, an inducement be provided to members
of the California National Guard by making education assistance
awards available to California National Guard members seeking to
improve themselves through higher education. It is the intent of the
Legislature that these assistance awards be available to California
National Guard members who serve the state faithfully.
  SEC. 55.  Section 69999.18 of the Education Code is amended to
read:
   69999.18.  (a) The Student Aid Commission is responsible for
issuing awards authorized by Section 69999.16, upon receipt of a
certificate from the Adjutant General verifying that the applicant
meets the eligibility requirements of this article. The commission
shall provide any information to the Military Department that is
necessary to meet the reporting requirements of Section 69999.24.
   (b) The amount of an award issued pursuant to this article shall
be as follows:
   (1) For a recipient attending the University of California or the
California State University, the maximum amount of the Cal Grant A
award, pursuant to Section 66021.2, as adjusted in the annual Budget
Act.
   (2) For a recipient attending a community college, the maximum
amount of the Cal Grant B award, pursuant to Section 66021.2, as
adjusted in the annual Budget Act.
   (3) For a recipient attending a nonpublic institution, the maximum
amount of a Cal Grant A award for a student attending the University
of California pursuant to Section 66021.2, as adjusted in the annual
Budget Act.
   (c) An award used for graduate studies shall not exceed the
maximum amount of a Cal Grant A award, as specified in paragraph (1)
of subdivision (b), plus five hundred dollars ($500) for books and
supplies.
   (d) The award amount under subdivisions (b) and (c) shall not
exceed the difference between the recipient's cost of attendance and
any other student financial aid and educational benefits pursuant to
the federal Montgomery GI Bill (38 U.S.C. Sec. 3001 et seq.) or any
other federal educational benefits program for veterans.
   (e) California National Guard Education Assistance awards may be
renewed for each new academic year, for a maximum of the greater of
either (1) four years of full-time equivalent enrollment or (2) the
duration for which the qualifying member would otherwise be eligible
pursuant to the Cal Grant Program (Chapter 1.7 (commencing with
Section 69430)), if the Adjutant General certifies the qualifying
member's eligibility and the qualifying member maintains at least a
2.0 cumulative grade point average.
  SEC. 56.  Section 69999.20 of the Education Code is amended to
read:
   69999.20.  Qualifying members shall not receive both a California
National Guard Education Assistance award and any Cal Grant award for
the same academic year. A qualifying member under this article who
is also eligible for a Cal Grant award may elect between an award
under this article and any Cal Grant award for the same academic
year.
  SEC. 57.  Section 87482 of the Education Code is amended to read:
   87482.  (a) (1) Notwithstanding Section 87480, the governing board
of a community college district may employ any qualified individual
as a temporary faculty member for a complete school year, but not
less than a complete semester or quarter during a school year. The
employment of those persons shall be based upon the need for
additional faculty during a particular semester or quarter because of
the higher enrollment of students during that semester or quarter as
compared to the other semester or quarter in the academic year, or
because a faculty member has been granted leave for a semester,
quarter, or year, or is experiencing long-term illness, and shall be
limited, in number of persons so employed, to that need, as
determined by the governing board.
   (2) Employment of a person under this subdivision may be pursuant
to contract fixing a salary for the entire semester or quarter.
   (b) A person, other than a person serving as clinical nursing
faculty and exempted from this subdivision pursuant to paragraph (1)
of subdivision (c), shall not be employed by any one district under
this section for more than two semesters or three quarters within any
period of three consecutive years.
   (c) (1) Notwithstanding subdivision (b), a person serving as
full-time clinical nursing faculty or as part-time clinical nursing
faculty teaching the hours per week described in Section 87482.5 may
be employed by any one district under this section for up to four
semesters or six quarters within any period of three consecutive
academic years between July 1, 2007, and June 30, 2014, inclusive.
   (2) A district that employs faculty pursuant to this subdivision
shall provide data to the chancellor's office as to the number of
faculty members hired under this subdivision, and what the ratio of
full-time to part-time faculty was for each of the three academic
years prior to the hiring of faculty under this subdivision and for
each academic year for which faculty is hired under this subdivision.
This data shall be submitted, in writing, to the chancellor's office
on or before June 30, 2012.
   (3) The chancellor shall report, in writing, to the Legislature
and the Governor on or before September 30, 2012, in accordance with
data received pursuant to paragraph (2), the number of districts that
hired faculty under this subdivision, the number of faculty members
hired under this subdivision, and what the ratio of full-time to
part-time faculty was for these districts in each of the three
academic years prior to the operation of this subdivision and for
each academic year for which faculty is hired under this subdivision.

   (4) A district may not employ a person pursuant to this
subdivision if the hiring of that person results in an increase in
the ratio of part-time to full-time nursing faculty in that district.

  SEC. 58.  Section 88003.1 of the Education Code is amended to read:

   88003.1.  (a) Notwithstanding any other provision of this chapter,
personal services contracting for all services currently or
customarily performed by classified school employees to achieve cost
savings is permissible, unless otherwise prohibited, when all the
following conditions are met:
   (1) The governing board or contracting agency clearly demonstrates
that the proposed contract will result in actual overall cost
savings to the community college district, provided that:
   (A) In comparing costs, there shall be included the community
college district's additional cost of providing the same service as
proposed by a contractor. These additional costs shall include the
salaries and benefits of additional staff that would be needed and
the cost of additional space, equipment, and materials needed to
perform the function.
   (B) In comparing costs, there shall not be included the community
college district's indirect overhead costs unless these costs can be
attributed solely to the function in question and would not exist if
that function was not performed by the community college district.
Indirect overhead costs shall mean the pro rata share of existing
administrative salaries and benefits, rent, equipment costs,
utilities, and materials.
   (C) In comparing costs, there shall be included in the cost of a
contractor providing a service any continuing community college
district costs that would be directly associated with the contracted
function. These continuing community college district costs shall
include, but not be limited to, those for inspection, supervision,
and monitoring.
   (2) Proposals to contract out work shall not be approved solely on
the basis that savings will result from lower contractor pay rates
or benefits. Proposals to contract out work shall be eligible for
approval if the contractor's wages are at the industry's level and do
not undercut community college district pay rates.
   (3) The contract does not cause the displacement of community
college district employees. The term "displacement" includes layoff,
demotion, involuntary transfer to a new classification, involuntary
transfer to a new location requiring a change of residence, and time
base reductions. Displacement does not include changes in shifts or
days off, nor does it include reassignment to other positions within
the same classification and general location or employment with the
contractor, so long as wages and benefits are comparable to those
paid by the school district.
   (4) The savings shall be large enough to ensure that they will not
be eliminated by private sector and community college district cost
fluctuations that could normally be expected during the contracting
period.
   (5) The amount of savings clearly justify the size and duration of
the contracting agreement.
   (6) The contract is awarded through a publicized, competitive
bidding process.
   (7) The contract includes specific provisions pertaining to the
qualifications of the staff that will perform the work under the
contract, as well as assurance that the contractor's hiring practices
meet applicable nondiscrimination standards.
   (8) The potential for future economic risk to the community
college district from potential contractor rate increases is minimal.

   (9) The contract is with a firm. A "firm" means a corporation,
limited liability company, partnership, nonprofit organization, or
sole proprietorship.
   (10) The potential economic advantage of contracting is not
outweighed by the public's interest in having a particular function
performed directly by the community college district.
   (b) Notwithstanding any other provision of this chapter, personal
services contracting shall also be permissible when any of the
following conditions can be met:
   (1) The contract is for new community college district functions
and the Legislature has specifically mandated or authorized the
performance of the work by independent contractors.
   (2) The services contracted are not available within community
college districts, cannot be performed satisfactorily by community
college district employees, or are of such a highly specialized or
technical nature that the necessary expert knowledge, experience, and
ability are not available through the community college district.
   (3) The services are incidental to a contract for the purchase or
lease of real or personal property. Contracts under this criterion,
known as "service agreements," shall include, but not be limited to,
agreements to service or maintain office equipment or computers that
are leased or rented.
   (4) The policy, administrative, or legal goals and purposes of the
community college district cannot be accomplished through the
utilization of persons selected pursuant to the regular or ordinary
hiring process. Contracts are permissible under this criterion to
protect against a conflict of interest or to ensure independent and
unbiased findings in cases where there is a clear need for a
different, outside perspective. These contracts shall include, but
not be limited to, obtaining expert witnesses in litigation.
   (5) The nature of the work is such that the criteria for emergency
appointments apply. "Emergency appointment" means an appointment
made for a period not to exceed 60 working days either during an
actual emergency to prevent the stoppage of public business or
because of the limited duration of the work. The method of selection
and the qualification standards for an emergency employee shall be
determined by the community college district. The frequency of
appointment, length of employment, and the circumstances appropriate
for the appointment of firms or individuals under emergency
appointments shall be restricted so as to prevent the use of
emergency appointments to circumvent the regular or ordinary hiring
process.
   (6) The contractor will provide equipment, materials, facilities,
or support services that could not feasibly be provided by the
community college district in the location where the services are to
be performed.
   (7) The services are of such an urgent, temporary, or occasional
nature that the delay incumbent in their implementation under the
community college district's regular or ordinary hiring process would
frustrate their very purpose.
   (c) This section shall apply to all community colleges, including
community college districts that have adopted the merit system.
   (d) This section shall apply to personal service contracts entered
into after January 1, 2003. This section shall not apply to the
renewal of personal services contracts subsequent to January 1, 2003,
where the contract was entered into before January 1, 2003,
irrespective of whether the contract is renewed or rebid with the
existing contractor or with a new contractor.
  SEC. 59.  Section 89267.5 of the Education Code is amended to read:

   89267.5.  (a) As used in this section, "ADN-to-BSN student" means
a person who meets all of the following qualifications:
   (1) The person has earned an associate degree in nursing from a
California Community College from a program approved by the Board of
Registered Nursing.
   (2) The person is licensed to work in California as a registered
nurse.
   (3) The person is applying to the California State University to
earn a bachelor of science in nursing.
   (b) Prior to the commencement of the 2012-13 academic year, the
Chancellor of the California State University shall implement
articulated nursing degree transfer pathways between the California
Community Colleges and the California State University. The
articulated nursing degree transfer pathways shall, at a minimum,
comply with both of the following requirements:
   (1) A campus of the California State University shall not require
an ADN-to-BSN student to complete any duplicative courses for which
the content is already required by the Board of Registered Nursing
for licensure or that the student has already satisfied by earning
the associate degree in nursing and becoming licensed as a registered
nurse.
   (2) A campus of the California State University shall not require
an ADN-to-BSN student, who has taken a prerequisite course at a
California community college to earn the associate degree in nursing,
to take the same prerequisite course or same content from that
prerequisite course at the university for the bachelor of science in
nursing degree.
   (c) The Chancellor of the California State University and the
Chancellor of the California Community Colleges may appoint
representatives from their respective institutions to work
collaboratively to provide advice and assistance on either or both of
the following:
   (1) Implementation of the articulated nursing degree transfer
pathways.
                            (2) Identification of additional
components to be included that are consistent with providing
ADN-to-BSN students with a streamlined nursing degree transfer
pathway consistent with the finding in subdivision (g) of Section 1
of Chapter 283 of the Statutes of 2009.
   (d) By March 15, 2011, the Legislative Analyst's Office shall
prepare and submit to the Legislature and the Governor a report on
the status of plans to implement articulated nursing degree transfer
pathways between the California Community Colleges and the California
State University. This report may be part of its annual budget
report to the Legislature.
  SEC. 60.  Section 354.5 of the Elections Code is amended to read:
   354.5.  (a) "Signature" includes either of the following:
   (1) A person's mark if the name of the person affixing the mark is
written near the mark by a witness over 18 years of age designated
by the person and the designee subscribes his or her own name as a
witness thereto. For purposes of this paragraph, a signature stamp
may be used as a mark, provided that the authorized user complies
with the provisions of this paragraph.
   (2) An impression made by the use of a signature stamp pursuant to
the requirements specified in subdivision (c).
   (b) A mark attested as provided in paragraph (1) of subdivision
(a), or an impression made by a signature stamp as provided in
paragraph (2) of subdivision (a), may serve as a signature for any
purpose specified in this code, including a sworn statement.
   (c) An authorized user of a signature stamp may use it to affix a
signature to a document or writing any time that a signature is
required by this code, provided that all of the following conditions,
as applicable, are met:
   (1) A signature stamp used to obtain a ballot or vote by mail
ballot in any local, state, or federal election shall be used only by
the authorized user of that signature stamp.
   (2) A signature stamp shall be affixed by the authorized user in
the presence of the Secretary of State, his or her designee, the
local elections official, or his or her designee, to obtain a ballot,
in any local, state, or federal election unless the authorized user
of the signature stamp votes by vote by mail ballot. If the owner of
a signature stamp votes by vote by mail ballot, he or she shall affix
the signature stamp on the identification envelope in accordance
with the requirements of Section 3019.
   (d) A signature affixed with a signature stamp by an authorized
user in accordance with the requirements of this section shall be
treated in the same manner as a signature made in writing.
   (e) A registered voter or any person who is eligible to vote, who
qualifies as an authorized user pursuant to paragraph (1) of
subdivision (g), may use a signature stamp only after he or she first
submits his or her affidavit of registration or a new affidavit of
registration, whichever is applicable, in the presence of a county
elections official, using the signature stamp to sign the affidavit.
   (f) The Secretary of State shall report to the Legislature not
later than January 1, 2009, regarding the use of signature stamps
during the 2008 elections.
   (g) The following definitions apply for purposes of this section:
   (1) "Authorized user" means either of the following:
   (A) A person with a disability who, by reason of that disability,
is unable to write and who owns a signature stamp.
   (B) A person using the signature stamp on behalf of the owner of
the stamp with the owner's express consent and in the presence of the
owner.
   (2) "Disability" means a medical condition, mental disability, or
physical disability, as those terms are defined in subdivisions (h),
(i), and (k) of Section 12926 of the Government Code.
   (3) "Signature stamp" means a stamp that contains the impression
of any of the following:
   (A) The actual signature of a person with a disability.
   (B) A mark or symbol that is adopted by the person with the
disability.
   (C) A signature of the name of a person with a disability that is
made by another person and is adopted by the person with the
disability.
  SEC. 60.3.  Section 2157 of the Elections Code is amended to read:
   2157.  (a) Subject to this chapter, the affidavit of registration
shall be in a form prescribed by regulations adopted by the Secretary
of State. The affidavit shall:
   (1) Contain the information prescribed in Section 2150.
   (2) Be sufficiently uniform among the separate counties to allow
for the processing and use by one county of an affidavit completed in
another county.
   (3) Allow for the inclusion of informational language to meet the
specific needs of that county, including, but not limited to, the
return address of the elections official in that county, and a
telephone number at which a voter can obtain elections information in
that county.
   (4) Be included on one portion of a multipart card, to be known as
a voter registration card, the other portions of which shall include
information sufficient to facilitate completion and mailing of the
affidavit. The affidavit portion of the multipart card shall be
numbered according to regulations adopted by the Secretary of State.
For purposes of facilitating the distribution of voter registration
cards as provided in Section 2158, there shall be attached to the
affidavit portion a receipt. The receipt shall be separated from the
body of the affidavit by a perforated line.
   (5) Contain, in a type size and color of ink that is clearly
distinguishable from surrounding text, a statement identical or
substantially similar to the following:
   "Certain voters facing life-threatening situations may qualify for
confidential voter status. For more information, please contact the
Secretary of State's Safe At Home program or visit the Secretary of
State's Web site."
   (6) Contain, in a type size and color of ink that is clearly
distinguishable from surrounding text, a statement that the use of
voter registration information for commercial purposes is a
misdemeanor pursuant to subdivision (a) of Section 2194, and any
suspected misuse shall be reported to the Secretary of State.
   (7) Contain a toll-free fraud hotline telephone number maintained
by the Secretary of State that the public may use to report suspected
fraudulent activity concerning misuse of voter registration
information.
   (8) Be returnable to the county elections official as a
self-enclosed mailer with postage prepaid by the Secretary of State.
   (b) Nothing contained in this division shall prevent the use of
voter registration cards and affidavits of registration in existence
on the effective date of this section and produced pursuant to
regulations of the Secretary of State, and all references to voter
registration cards and affidavits in this division shall be applied
to the existing voter registration cards and affidavits of
registration.
   (c) The Secretary of State may continue to supply existing
affidavits of registration prior to printing new or revised forms
that reflect the changes required pursuant to this section, Section
2150, or Section 2160.
  SEC. 60.5.  Section 2157.2 of the Elections Code is amended to
read:
   2157.2.  In order that a voter be fully informed of the
permissible uses of personal information supplied by him or her for
the purpose of completing a voter registration affidavit, local
elections officials shall post on any local elections official's
Internet Web site relating to voter information, and the Secretary of
State shall print in the state ballot pamphlet and post on his or
her Internet Web site, a statement identical or substantially similar
to the following:
   "Information on your voter registration affidavit will be used by
elections officials to send you official information on the voting
process, such as the location of your polling place and the issues
and candidates that will appear on the ballot. Commercial use of
voter registration information is prohibited by law and is a
misdemeanor. Voter information may be provided to a candidate for
office, a ballot measure committee, or other persons for election,
scholarly, journalistic, political, or governmental purposes, as
determined by the Secretary of State. Driver's license and social
security numbers, or your signature as shown on your voter
registration card, cannot be released for these purposes. If you have
any questions about the use of voter information or wish to report
suspected misuse of such information, please call the Secretary of
State's Voter Protection and Assistance Hotline.
   "Certain voters facing life-threatening situations may qualify for
confidential voter status. For more information, please contact the
Secretary of State's Safe At Home program or visit the Secretary of
State's Web site."
  SEC. 61.  Section 2225 of the Elections Code is amended to read:
   2225.  (a) Based on change-of-address data received from the
United States Postal Service or its licensees, the county elections
official shall send a forwardable notice, including a postage-paid
and preaddressed return form, to enable the voter to verify or
correct address information.
   Notification received through NCOA or Operation Mail that a voter
has moved and has given no forwarding address shall not require the
mailing of a forwardable notice to that voter.
   (b) If change-of-address data indicates that the voter has moved
to a new residence address in the same county, the forwardable notice
shall be in substantially the following form:

   "We have received notification that the voter has moved to a new
residence address in ____ County. You will be registered to vote at
your new address unless you notify our office within 15 days that the
address to which this card was mailed is not a change of your
permanent residence. You must notify our office by either returning
the attached postage-paid postcard, or by calling toll free. If this
is not a permanent residence, and if you do not notify us within 15
days, you may be required to provide proof of your residence address
in order to vote at future elections."

   (c) If change-of-address data indicates that the voter has moved
to a new address in another county, the forwardable notice shall be
in substantially the following form:

   "We have received notification that you have moved to a new
address not in ____ County. Please use the attached postage-paid
postcard to: (1) advise us if this is or is not a permanent change of
residence address, or (2) to advise us if our information is
incorrect. If you do not return this card within 15 days and continue
to reside in ____ County, you may be required to provide proof of
your residence address in order to vote at future elections and, if
you do not offer to vote at any election in the period between the
date of this notice and the second federal general election following
this notice, your voter registration will be cancelled and you will
have to reregister in order to vote. If you no longer live in ____
County, you must reregister at your new residence address in order to
vote in the next election. California residents may obtain a mail
registration form by calling the county elections officer or
1-800-345-VOTE."

   (d) If postal service change-of-address data received from a
nonforwardable mailing indicates that a voter has moved and left no
forwarding address, a forwardable notice shall be sent in
substantially the following form:

   "We are attempting to verify postal notification that the voter to
whom this card is addressed has moved and left no forwarding
address. If the person receiving this card is the addressed voter,
please confirm your continued residence or provide current residence
information on the attached postage-paid postcard within 15 days. If
you do not return this card and continue to reside in ____ County,
you may be required to provide proof of your residence address in
order to vote at future elections and, if you do not offer to vote at
any election in the period between the date of this notice and the
second federal general election following this notice, your voter
registration will be cancelled and you will have to reregister in
order to vote. If you no longer live in ____ County, you must
reregister at your new residence address in order to vote in the next
election. California residents may obtain a mail registration form
by calling the county elections office or the Secretary of State's
Office."

   (e) The use of a toll-free number to confirm the old residence
address is optional. Any change to the voter address must be received
in writing.
  SEC. 62.  Section 11100 of the Elections Code is amended to read:
   11100.  (a) This chapter applies only to the recall of state
officers.
   (b) In addition to this chapter, Sections 13 to 18, inclusive, of
Article II of the California Constitution and the applicable
provisions of Chapter 1 (commencing with Section 11000) and Chapter 4
(commencing with Section 11300) shall govern the recall of state
officers.
  SEC. 63.  Section 13307 of the Elections Code is amended to read:
   13307.  (a) (1) Each candidate for nonpartisan elective office in
any local agency, including any city, county, city and county, or
district, may prepare a candidate's statement on an appropriate form
provided by the elections official. The statement may include the
name, age, and occupation of the candidate and a brief description,
of no more than 200 words, of the candidate's education and
qualifications expressed by the candidate himself or herself.
However, the governing body of the local agency may authorize an
increase in the limitations on words for the statement from 200 to
400 words. The statement shall not include the party affiliation of
the candidate, nor membership or activity in partisan political
organizations.
   (2) The statement authorized by this subdivision shall be filed in
the office of the elections official when the candidate's nomination
papers are returned for filing, if it is for a primary election, or
for an election for offices for which there is no primary. The
statement shall be filed in the office of the elections official no
later than the 88th day before the election, if it is for an election
for which nomination papers are not required to be filed. If a
runoff election or general election occurs within 88 days of the
primary or first election, the statement shall be filed with the
elections official by the third day following the governing body's
declaration of the results from the primary or first election.
   (3) Except as provided in Section 13309, the statement may be
withdrawn, but not changed, during the period for filing nomination
papers and until 5 p.m. of the next working day after the close of
the nomination period.
   (b) The elections official shall send to each voter, together with
the sample ballot, a voter's pamphlet which contains the written
statements of each candidate that is prepared pursuant to this
section. The statement of each candidate shall be printed in type of
uniform size and darkness, and with uniform spacing. The elections
official shall provide a Spanish translation to those candidates who
wish to have one, and shall select a person to provide that
translation from the list of approved Spanish language translators
and interpreters of the superior court of the county or from an
institution accredited by the Western Association of Schools and
Colleges.
   (c) The local agency may estimate the total cost of printing,
handling, translating, and mailing the candidate's statements filed
pursuant to this section, including costs incurred as a result of
complying with the federal Voting Rights Act of 1965, as amended. The
local agency may require each candidate filing a statement to pay in
advance to the local agency his or her estimated pro rata share as a
condition of having his or her statement included in the voter's
pamphlet. In the event the estimated payment is required, the receipt
for the payment shall include a written notice that the estimate is
just an approximation of the actual cost that varies from one
election to another election and may be significantly more or less
than the estimate, depending on the actual number of candidates
filing statements. Accordingly, the local agency is not bound by the
estimate and may, on a pro rata basis, bill the candidate for
additional actual expense or refund any excess paid depending on the
final actual cost. In the event of underpayment, the local agency may
require the candidate to pay the balance of the cost incurred. In
the event of overpayment, the local agency which, or the elections
official who, collected the estimated cost shall prorate the excess
amount among the candidates and refund the excess amount paid within
30 days of the election.
   (d) Nothing in this section shall be deemed to make any statement,
or the authors thereof, free or exempt from any civil or criminal
action or penalty because of any false, slanderous, or libelous
statements offered for printing or contained in the voter's pamphlet.

   (e) Before the nominating period opens, the local agency for that
election shall determine whether a charge shall be levied against
that candidate for the candidate's statement sent to each voter. This
decision shall not be revoked or modified after the seventh day
prior to the opening of the nominating period. A written statement of
the regulations with respect to charges for handling, packaging, and
mailing shall be provided to each candidate or his or her
representative at the time he or she picks up the nomination papers.
   (f) For purposes of this section and Section 13310, the board of
supervisors shall be deemed the governing body of judicial elections.

  SEC. 64.  Section 1118 of the Evidence Code is amended to read:
   1118.  An oral agreement "in accordance with Section 1118" means
an oral agreement that satisfies all of the following conditions:
   (a) The oral agreement is recorded by a court reporter or reliable
means of audio recording.
   (b) The terms of the oral agreement are recited on the record in
the presence of the parties and the mediator, and the parties express
on the record that they agree to the terms recited.
   (c) The parties to the oral agreement expressly state on the
record that the agreement is enforceable or binding, or words to that
effect.
   (d) The recording is reduced to writing and the writing is signed
by the parties within 72 hours after it is recorded.
  SEC. 65.  Section 7572 of the Family Code is amended to read:
   7572.  (a) The Department of Child Support Services, in
consultation with the State Department of Health Care Services, the
California Association of Hospitals and Health Systems, and other
affected health provider organizations, shall work cooperatively to
develop written materials to assist providers and parents in
complying with this chapter. This written material shall be updated
periodically by the Department of Child Support Services to reflect
changes in law, procedures, or public need.
   (b) The written materials for parents which shall be attached to
the form specified in Section 7574 and provided to unmarried parents
shall contain the following information:
   (1) A signed voluntary declaration of paternity that is filed with
the Department of Child Support Services legally establishes
paternity.
   (2) The legal rights and obligations of both parents and the child
that result from the establishment of paternity.
   (3) An alleged father's constitutional rights to have the issue of
paternity decided by a court; to notice of any hearing on the issue
of paternity; to have an opportunity to present his case to the
court, including his right to present and cross-examine witnesses; to
have an attorney represent him; and to have an attorney appointed to
represent him if he cannot afford one in a paternity action filed by
a local child support agency.
   (4) That by signing the voluntary declaration of paternity, the
father is voluntarily waiving his constitutional rights.
   (c) Parents shall also be given oral notice of the rights and
responsibilities specified in subdivision (b). Oral notice may be
accomplished through the use of audio or video recorded programs
developed by the Department of Child Support Services to the extent
permitted by federal law.
   (d) The Department of Child Support Services shall, free of
charge, make available to hospitals, clinics, and other places of
birth any and all informational and training materials for the
program under this chapter, as well as the paternity declaration
form. The Department of Child Support Services shall make training
available to every participating hospital, clinic, local registrar of
births and deaths, and other place of birth no later than June 30,
1999.
   (e) The Department of Child Support Services may adopt
regulations, including emergency regulations, necessary to implement
this chapter.
  SEC. 66.  Section 2089.12 of the Fish and Game Code is amended to
read:
   2089.12.  (a) Unless the department determines that it is
inappropriate to do so based on the nature of the management actions
being proposed, the species listed in the permit, or other factors,
the agreement shall require that the landowner provide the department
with at least 60 days' advance notice of any of the following:
   (1) Any incidental take that is anticipated to occur under the
agreement.
   (2) The landowner's plan to return to baseline at the end of the
agreement.
   (3) Any plan to transfer or alienate the landowner's interest in
the land or water.
   (b) (1) If the department receives any notice described in
subdivision (a), the landowner shall provide the department, its
contractors, or agents with access to the land or water for purposes
of safely removing or salvaging the species.
   (2) The department shall provide notice to the landowner at least
seven days prior to accessing the land or water for the purposes of
paragraph (1). The notice shall identify each person selected by the
department, its contractors, or agents to access the land or water.
   (3) Notwithstanding paragraph (1), during the seven-day notice
period, a landowner may object, in writing, to a person selected to
access the land or water. If a landowner objects, another person
shall be selected by the department, its contractors, or agents, and
notification shall be provided to the landowner pursuant to paragraph
(2). However, if a landowner objects to a selection on two
successive occasions, the landowner shall be deemed to consent to
access to the land or water by a person selected by the department,
its contractors, or agents. Failure by a landowner to object to the
selection within the seven-day notice period shall be deemed consent
to access the land or water by a person selected by the department,
its contractors, or agents.
   (4) If the landowner objects to a person selected to access the
land or water pursuant to paragraph (3), the 60-day notice period
described in subdivision (a) shall be tolled for the period between
the landowner's objection to a person selected for access to the land
or water and the landowner's consent to a person selected for access
to the land or water.
  SEC. 67.  Section 2089.23 of the Fish and Game Code is amended to
read:
   2089.23.  (a) A landowner that owns land that abuts a property
enrolled in a state safe harbor agreement shall not be required, for
purposes of an incidental take permit, to undertake the management
activities set forth in the state safe harbor agreement, if all of
the following conditions are met:
   (1) The neighboring landowner allows the department to determine
baseline conditions on the property.
   (2) The neighboring landowner agrees to maintain the baseline
conditions for the duration specified in the safe harbor agreement.
   (3) The department determines that allowing the neighboring
landowner to receive an incidental take permit for the abutting
property does not undermine the net conservation benefit
determination made by the department in the approval of the safe
harbor agreement.
   (4) The take authorized by the department will not jeopardize the
continued existence of the species. This determination shall be made
in accordance with subdivision (c) of Section 2081.
   (b) (1) Unless the department determines that it is inappropriate
to do so based on the species listed in the permit, or any other
factors, the neighboring landowner shall provide the department with
at least 60 days' advance notice of any of the following:
   (A) Any incidental take that is anticipated to occur under the
permit.
   (B) The neighboring landowner's plan to return to baseline
conditions.
   (C) Any plan to transfer or alienate the neighboring landowner's
interest in the land or water.
   (2) (A) If the department receives any notice described in
paragraph (1), the neighboring landowner shall provide the
department, its contractors, or agents with access to the land or
water for purposes of safely removing or salvaging the species.
   (B) The department shall provide notice to the neighboring
landowner at least seven days before accessing the land or water for
the purposes of subparagraph (A). The notice shall identify each
person selected by the department, its contractors, or agents to
access the land or water.
   (C) Notwithstanding subparagraph (B), during the seven-day notice
period, the neighboring landowner may object, in writing, to a person
selected to access the land or water. If the neighboring landowner
objects, another person shall be selected by the department, its
contractors, or agents, and notification shall be provided to the
neighboring landowner pursuant to subparagraph (B). However, if the
neighboring landowner objects to a selection on two successive
occasions, the neighboring landowner shall be deemed to consent to
access to the land or water by a person selected by the department,
its contractors, or agents. Failure by the neighboring landowner to
object to the selection within the seven-day notice period shall be
deemed consent to access the land or water by the person selected by
the department, its contractors, or agents.
  SEC. 68.  Section 5655 of the Fish and Game Code is amended to
read:
   5655.  (a) In addition to the responsibilities imposed pursuant to
Section 5651, the department may clean up or abate, or cause to be
cleaned up or abated, the effects of any petroleum or petroleum
product deposited or discharged in the waters of this state or
deposited or discharged in any location onshore or offshore where the
petroleum or petroleum product is likely to enter the waters of this
state, order any person responsible for the deposit or discharge to
clean up the petroleum or petroleum product or abate the effects of
the deposit                                           or discharge,
and recover any costs incurred as a result of the cleanup or
abatement from the responsible party.
   (b) An order shall not be issued pursuant to this section for the
cleanup or abatement of petroleum products in any sump, pond, pit, or
lagoon used in conjunction with crude oil production that is in
compliance with all applicable state and federal laws and
regulations.
   (c) The department may issue an order pursuant to this section
only if there is an imminent and substantial endangerment to human
health or the environment and the order shall remain in effect only
until any cleanup and abatement order is issued pursuant to Section
13304 of the Water Code. A regional water quality control board shall
incorporate the department's order into the cleanup and abatement
order issued pursuant to Section 13304 of the Water Code, unless the
department's order is inconsistent with any more stringent
requirement established in the cleanup and abatement order. Any
action taken in compliance with the department's order is not a
violation of any subsequent regional water quality control board
cleanup and abatement order issued pursuant to Section 13304 of the
Water Code.
   (d) The Administrator of the Office of Spill Prevention and
Response has the primary authority to serve as a state incident
commander and direct removal, abatement, response, containment, and
cleanup efforts with regard to all aspects of any placement of
petroleum or a petroleum product in the waters of the state, except
as otherwise provided by law. This authority may be delegated.
   (e) For purposes of this section, the following definitions apply:

   (1) "Petroleum product" means oil of any kind or form, including,
but not limited to, fuel oil, sludge, oil refuse, and oil mixed with
waste other than dredged spoil. "Petroleum product" does not include
any pesticide that has been applied for agricultural, commercial, or
industrial purposes or that has been applied in accordance with a
cooperative agreement authorized by Section 116180 of the Health and
Safety Code, that has not been discharged accidentally or for
purposes of disposal, and the application of which was in compliance
with all applicable state and federal laws and regulations.
   (2) "State incident commander" means a person with the overall
authority for managing and conducting incident operations during an
oil spill response, who shall manage an incident consistent with the
standardized emergency management system required by Section 8607 of
the Government Code. Incident management generally includes the
development of objectives, strategies, and tactics, ordering and
release of resources, and coordinating with other appropriate
response agencies to ensure that all appropriate resources are
properly utilized and that this coordinating function is performed in
a manner designed to minimize risk to other persons and to the
environment.
  SEC. 69.  Section 9011 of the Fish and Game Code is amended to
read:
   9011.  (a) (1) Subject to Article 6 (commencing with Section 8275)
of Chapter 2, Dungeness crab, as defined in Section 8275, may be
taken with Dungeness crab traps.
   (2) A Dungeness crab trap may have any number of openings of any
size. However, every Dungeness crab trap shall have at least two
rigid circular openings of not less than 41/4 inches, inside
diameter, on the top or side of the trap. If both of the openings are
located on the side of the trap, at least one of the openings shall
be located so that at least one-half of the opening is in the upper
half of the trap.
   (3) Subject to Article 6 (commencing with Section 8275) of Chapter
2, rock crab may be taken incidentally with a Dungeness crab trap
used pursuant to this subdivision to take Dungeness crab, provided
that the incidental taking occurs only during the season when it is
lawful to take both species. A rock crab, taken incidentally with a
Dungeness crab trap, that does not comply with Article 6 (commencing
with Section 8275) of Chapter 2, shall be immediately returned to the
waters from which it was taken.
   (b) (1) Subject to Article 6 (commencing with Section 8275) of
Chapter 2, rock crab, as defined in Section 8275, may be taken with
rock crab traps.
   (2) A rock crab trap may have any number of openings of any size.
However, a rock crab trap constructed of wire mesh with an inside
mesh measurement of not less than 17/8 inches by 37/8 inches, with
the 37/8 inch measurement parallel to the floor, shall have at least
one rigid circular opening of not less than 31/4 inches, inside
diameter, located on any outside wall of the rearmost chamber of the
crab trap and shall be located so that at least one-half of the
opening is in the upper half of the trap. Rock crab traps constructed
of other material shall have at least two rigid circular openings of
not less than 31/4 inches, inside diameter, on the top or side of
the rearmost chamber of the trap. If both of the openings are located
on the side of the trap, at least one of the openings shall be
located so that at least one-half of the opening is in the upper half
of the trap. No rigid circular opening, as required, shall extend
more than 1/2 inch beyond the plane of the wall side or top of the
trap in which it is located, and it shall be clearly accessible to
any crab which may be in the trap.
   (3) Subject to Article 6 (commencing with Section 8275) of Chapter
2, Dungeness crab may be taken incidentally with a rock crab trap
used pursuant to this subdivision to take rock crab, provided that
the incidental taking occurs only during the season when it is lawful
to take both species. A Dungeness crab, taken incidentally with a
rock crab trap, that does not comply with Article 6 (commencing with
Section 8275) of Chapter 2, shall be immediately returned to the
waters from which it was taken.
   (4) A person shall not possess any lobster aboard a vessel while
the vessel is being used pursuant to this subdivision to take rock
crab.
   (c) On or before January 1, 2013, the department shall report to
the appropriate policy and fiscal committees of the Legislature the
impacts, if any, of the changes made to this section by Chapter 478
of the Statutes of 2009. The report shall include information about
citations issued pursuant to this section relating to both rock crab
and Dungeness crab for the years 2010 to 2012, inclusive.
  SEC. 70.  Section 12013 of the Fish and Game Code is amended to
read:
   12013.  (a) Any person who illegally takes or possesses in the
field more than three times the daily bag limit, or who illegally
possesses more than three times the legal possession limit, of fish,
reptiles, birds, amphibians, or mammals is guilty of a misdemeanor
and shall be subject to a fine of not less than five thousand dollars
($5,000), nor more than forty thousand dollars ($40,000), or
imprisonment in a county jail for not more than one year, or by both
that fine and imprisonment.
   (b) If a person is convicted of a second or subsequent violation
of subdivision (a), that person shall be punished by a fine of not
less than ten thousand dollars ($10,000), nor more than fifty
thousand dollars ($50,000), or imprisonment in a county jail for not
more than one year, or by both that fine and imprisonment.
   (c) Any person who maliciously and intentionally maims, mutilates,
or physically tortures any fish, reptile, bird, amphibian, or mammal
provided for in this code is guilty of a crime punishable in
accordance with subdivision (a). Nothing in this subdivision affects
any legal activity pursuant to this code, including, but not limited
to, hunting, fishing, trapping, hunting dog training, hunting dog
field trials, predation control, and efforts to dispatch a wounded
mammal, bird, or fish taken legally.
   (d) Nothing in this section prohibits a person from giving,
receiving, or possessing the legal possession limit of lawfully taken
fish, reptiles, birds, amphibians, or mammals.
   (e) Nothing in this section prohibits a person from giving,
receiving, or possessing, at the personal abode of the donor or
donee, lawfully taken migratory game birds that are not required to
be tagged pursuant to the federal Migratory Bird Treaty Act (16
U.S.C. Sec. 703 et seq.) or regulations adopted pursuant to that act.

   (f) This section does not supersede Section 12005, 12006.6, or
12009.
   (g) Moneys equivalent to 50 percent of the revenue from any fine
collected pursuant to this section shall be paid to the county in
which the offense was committed, pursuant to Section 13003. The board
of supervisors shall first use revenues pursuant to this subdivision
to reimburse the costs incurred by the district attorney or city
attorney in investigating and prosecuting the violation. Any excess
revenues may be expended in accordance with Section 13103.
  SEC. 71.  Section 3884.2 of the Food and Agricultural Code is
amended to read:
   3884.2.  (a) The District 32a Disposition Fund is hereby created
in the State Treasury.
   (b) The Department of General Services may sell all or any portion
of the real property that composes District 32a. District 32a shall
not enter into any contract, lease, or other agreement affecting the
use or operation of the real property for a period that exceeds three
months, and all of these contracts, leases, or other agreements
shall contain a provision that they may be canceled upon a 30-day
notice from the Department of General Services. The Department of
General Services shall be reimbursed for any reasonable cost or
expense incurred for the transactions described in this section.
Additionally, to the extent bonds issued by the State Public Works
Board or other entity involve the property to be sold pursuant to
this section, all issuer- and trustee-related costs associated with
the review of any proposed sale, together with the costs related to
the defeasance or retirement of any bonds, which may include the cost
of nationally recognized bond counsel, shall be paid from the
proceeds of any sale or lease authorized by this section. The net
proceeds from the sale shall be deposited into the District 32a
Disposition Fund.
   (c) The sale of the real property authorized by this section shall
be pursuant to a public bidding process designed to obtain the
highest, most certain return for the state from a responsible bidder,
and any transaction based on such a bidding process shall be deemed
to be the fair market value for the property. A notice of this
bidding process shall be posted by the Department of General Services
on its Internet Web site for at least 30 days prior to the sale of
the real property. The provisions of Section 11011.1 of the
Government Code are not applicable to the sale of real property
authorized under this section.
   (d) Thirty days prior to executing a transaction for a sale of
real property authorized by this section, the Director of General
Services shall report to the chairpersons of the fiscal committees of
the Legislature all of the following:
   (1) The financial terms of the transaction.
   (2) A comparison of fair market value for the real property and
the terms listed in paragraph (1).
   (3) Any basis for agreeing to terms and conditions other than fair
market value.
   (e) As to the real property sold pursuant to this section, the
Director of General Services shall except and reserve to the state
all mineral deposits, as defined in Section 6407 of the Public
Resources Code, together with the right to prospect for, mine, and
remove the deposits. If, however, the Director of General Services
determines that there is little or no potential for mineral deposits,
the reservation may be without surface right of entry above a depth
of 500 feet, or the rights to prospect for, mine, and remove the
deposits shall be limited to those areas of the real property
conveyed that the director determines to be reasonably necessary for
the removal of the deposits.
   (f) The Department of General Services shall report to the
Legislature on or before June 30 of each year on the status of the
sale of real property authorized by this section.
   (g) Upon the sale of all property that composes District 32a,
District 32a shall be abolished and all funds in the District 32a
Disposition Fund shall be transferred to the General Fund.
   (h) (1) The disposition of state real property or buildings
specified in subdivision (b) that are made on an "as is" basis shall
be exempt from Chapter 3 (commencing with Section 21100) to Chapter 6
(commencing with Section 21165), inclusive, of Division 13 of the
Public Resources Code. Upon title to the parcel vesting in the
purchaser or transferee of the property, the purchaser or transferee
shall be subject to any local governmental land use entitlement
approval requirements and to Chapter 3 (commencing with Section
21100) to Chapter 6 (commencing with Section 21165), inclusive, of
Division 13 of the Public Resources Code.
   (2) If the disposition of state real property or buildings
specified in subdivision (b) is not made on an "as is" basis and
close of escrow is contingent on the satisfaction of a local
governmental land use entitlement approval requirement or compliance
by the local government with Chapter 3 (commencing with Section
21100) to Chapter 6 (commencing with Section 21165), inclusive, of
Division 13 of the Public Resources Code, the execution of the
purchase and sale agreement or of the exchange agreement by all
parties to the agreement shall be exempt from Chapter 3 (commencing
with Section 21100) to Chapter 6 (commencing with Section 21165),
inclusive, of Division 13 of the Public Resources Code.
   (3) For the purposes of this subdivision, "disposition" means the
sale, lease, or repurchase of state property or buildings specified
in subdivision (b).
   (i) The disposition of real property or buildings, or both,
pursuant to this section does not constitute a sale or other
disposition of state surplus property within the meaning of Section 9
of Article III of the California Constitution and shall not be
subject to subdivision (g) of Section 11011 of the Government Code.
  SEC. 72.  Section 5931 of the Food and Agricultural Code is amended
to read:
   5931.  In the event the committee and the citrus pest control
districts do not agree on the terms of the memorandum of
understanding as prescribed in Section 5930, the citrus pest control
districts shall conduct an election to determine which entity shall
provide funding for the citrus tristeza virus effective plan. The
ballot shall ask landowners within the citrus pest control districts
to select either (1) the California Citrus Pest and Disease
Prevention Committee and the Department of Food and Agriculture
through the Citrus Disease Management Account to fund the citrus
tristeza virus effective plan or (2) the citrus pest control
districts as the funding entity of the citrus tristeza virus
effective plan.
  SEC. 73.  Section 6047.12 of the Food and Agricultural Code is
amended to read:
   6047.12.  (a) Expenditures charged by the department and the board
for administrative purposes shall not exceed a total of 14 percent
of the assessments collected pursuant to this article. Administrative
purposes shall include, but not be limited to, all auditing expenses
and all costs and attorney's fees resulting from, or relating to,
litigation involving this article against the department, or the
board and its members and agents, and expenses associated with
Section 6047.4 and paragraphs (1) and (2) of subdivision (a) of
Section 6047.5.
   (b) Notwithstanding subdivision (a), the Joint Legislative Audit
Committee and the State Auditor shall maintain independent authority
to audit the expenditure of industry assessments.
  SEC. 74.  Section 15061 of the Food and Agricultural Code, as
amended by Section 2 of Chapter 245 of the Statutes of 2009, is
amended to read:
   15061.  (a) An inspection tonnage tax at the maximum rate of
fifteen cents ($0.15) per ton of commercial feed sold, except whole
grains, and whole hays when unmixed, shall be paid to the secretary
by any person who distributes commercial feed to a consumer-buyer in
this state. The distributor shall also pay an inspection tonnage tax
for purchased commercial feed fed to his or her own animals.
   (b) The secretary may, based upon a finding and recommendation of
the Feed Inspection Advisory Board, determine the specific rate
necessary to provide the revenue needed to carry out the provisions
of this chapter. The secretary and the Feed Inspection Advisory Board
shall not exceed the maximum tonnage rate established by this
section. Setting the tonnage tax rate shall not be subject to Chapter
3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title
2 of the Government Code.
   (c) The secretary may, based upon a finding and recommendation of
the Feed Inspection Advisory Board, designate 15 percent of the
tonnage taxes collected, or two hundred thousand dollars ($200,000),
whichever amount is greater, to provide funding for research and
education regarding the safe manufacture, distribution, and use of
commercial feed. These funds may only be spent on activities approved
by the Feed Inspection Advisory Board, with approval being made
prior to any expenditure.
   (d) This section shall remain in effect only until January 1,
2015, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2015, deletes or extends
that date.
  SEC. 75.  Section 71031 of the Food and Agricultural Code is
amended to read:
   71031.  "Person" means any individual, partnership, limited
liability partnership, corporation, limited liability company, firm,
company, or other entity doing business in California.
  SEC. 76.  Section 7906 of the Government Code is amended to read:
   7906.  For school districts:
   (a) "ADA" means a school district's second principal apportionment
units of average daily attendance as determined pursuant to Section
42238.5 of the Education Code, including average daily attendance in
summer school, regional occupational centers and programs, and
apprenticeship programs, and excluding average daily attendance in
adult education programs. All other units of average daily attendance
including, but not limited to, special day classes for special
education pupils, shall be included.
   (1) For purposes of this subdivision, the average daily attendance
of summer school programs shall be determined pursuant to
subparagraph (F) of paragraph (1) of subdivision (a) of Section
14022.5 of the Education Code.
   (2) For purposes of this subdivision, the average daily attendance
of apprenticeship programs shall be determined pursuant to
subparagraph (D) of paragraph (1) of subdivision (a) of Section
14022.5 of the Education Code.
   (3) For the 2008-09, 2009-10, 2010-11, 2011-12, and 2012-13 fiscal
years, the average daily attendance of public school districts,
including county superintendents of schools, serving kindergarten and
grades 1 to 12, inclusive, or any part thereof, shall include the
same amount of average daily attendance for classes for supplemental
instruction and regional occupational centers and programs that was
used for the purposes of this section for the 2007-08 fiscal year.
   (b) "Foundation program level" means:
   (1) For the 1978-79 fiscal year, one thousand two hundred
forty-one dollars ($1,241) for elementary districts, one thousand
three hundred twenty-two dollars ($1,322) for unified districts, and
one thousand four hundred twenty-seven dollars ($1,427) for high
school districts.
   (2) For the 1979-80 fiscal year to the 1986-87 fiscal year,
inclusive, the levels specified in paragraph (1) increased by the
lesser of the change in cost of living or California per capita
personal income for the preceding calendar year.
   (3) For the 1986-87 fiscal year, the levels specified in paragraph
(2) increased by one hundred eighty dollars ($180) for elementary
districts, one hundred ninety-one dollars ($191) for unified
districts, and two hundred seven dollars ($207) for high school
districts.
   (4) For the 1987-88 fiscal year, the levels specified in paragraph
(3) increased by the lesser of the change in cost of living or
California per capita personal income for the preceding calendar
year.
   (5) For the 1988-89 fiscal year and each fiscal year thereafter,
the foundation program level shall be the appropriations limit of the
school district for the current fiscal year, plus amounts paid for
any nonreimbursed court or federal mandates imposed on or after
November 6, 1979, less the sum of the following:
   (A) Interest earned on the proceeds of taxes during the current
fiscal year.
   (B) The 50 percent of miscellaneous funds received during the
current fiscal year which are from the proceeds of taxes.
   (C) Locally voted taxes received during the current fiscal year,
such as parcel taxes or square foot taxes, unless for voter-approved
bonded debt.
   (D) Any other local proceeds of taxes received during the current
fiscal year, other than local taxes which count towards the revenue
limit, such as excess bond revenues transferred to a district's
general fund pursuant to Section 15234 of the Education Code.
   (c) "Proceeds of taxes" shall be deemed to include subventions
received from the state only if those subventions are for one of the
following two purposes:
   (1) Basic aid subventions of one hundred twenty dollars ($120) per
ADA.
   (2) Additional apportionments which, when added to the district's
local revenues as defined in Section 42238 of the Education Code, do
not exceed the foundation program level for that district. In no case
shall subventions received from the state for reimbursement of state
mandates in accordance with the provisions of Section 6 of Article
XIII B of the California Constitution or of Section 17561 or for
reimbursement of court or federal mandates imposed on or after
November 6, 1979, be considered "proceeds of taxes" for the purposes
of this section.
   (d) Proceeds of taxes for a fiscal year shall not include any
proceeds of taxes within the district's beginning balance or reserve,
unless those funds were not appropriated in a prior fiscal year.
Funds that were appropriated to a reserve or other fund referenced in
Section 5 of Article XIII B of the California Constitution shall be
deemed to be appropriated for the purpose of this paragraph.
   (e) The remainder of the state apportionments, including special
purpose apportionments and categorical aid subventions shall not be
considered proceeds of taxes for a school district.
   (f) Each school district shall report to the Superintendent of
Public Instruction and to the Director of Finance at least annually
its appropriations limit, its appropriations subject to limitation,
the amount of its state aid apportionments and subventions included
within the proceeds of taxes of the school district, and amounts
excluded from its appropriations limit, at a time and in a manner
prescribed by the Superintendent of Public Instruction and approved
by the Director of Finance.
   (g) For the 1988-89 fiscal year and each fiscal year thereafter,
nothing in paragraph (2) of subdivision (c) shall be so construed as
to require that the amount determined pursuant to subdivision (b) be
multiplied by the amount determined pursuant to subdivision (a) for
purposes of determining the amount of state aid included in school
district "proceeds of taxes" for purposes of this section.
  SEC. 77.  Section 8588.1 of the Government Code is amended to read:

   8588.1.  (a) The Legislature finds and declares that this state
can only truly be prepared for the next disaster if the public and
private sector collaborate.
   (b) The California Emergency Management Agency may include, as
appropriate, private businesses and nonprofit organizations within
its responsibilities to prepare the state for disasters under this
chapter. All participation by businesses and nonprofit associations
in this program shall be voluntary.
   (c) The agency may do any of the following:
   (1) Provide guidance to business and nonprofit organizations
representing business interests on how to integrate private sector
emergency preparedness measures into governmental disaster planning
programs.
   (2) Conduct outreach programs to encourage business to work with
governments and community associations to better prepare the
community and their employees to survive and recover from disasters.
   (3) Develop systems so that government, businesses, and employees
can exchange information during disasters to protect themselves and
their families.
   (4) Develop programs so that businesses and government can work
cooperatively to advance technology that will protect the public
during disasters.
   (d) The agency may share facilities and systems for purposes of
subdivision (b) with the private sector to the extent the costs for
their use are reimbursed by the private sector.
   (e) Proprietary information or information protected by state or
federal privacy laws shall not be disclosed under this program.
   (f) Notwithstanding Section 11005, donations and private grants
may be accepted by the agency and shall not be subject to Section
11005.
   (g) The Disaster Resistant Communities Fund is hereby created in
the State Treasury. Upon appropriation by the Legislature, the
Secretary of California Emergency Management may expend the moneys in
the account for the costs associated with this section.
   (h) This section shall be implemented only to the extent that
in-kind contributions or donations are received from the private
sector, or grant funds are received from the federal government, for
these purposes.
  SEC. 78.  Section 8879.72 of the Government Code is amended to
read:
   8879.72.  (a) To establish the funding shares for each eligible
applicant described in paragraph (1) of subdivision (a) of Section
8879.71, the commission shall do the following prior to the
commencement of a funding cycle:
   (1) Determine the total amount of annual revenue generated from
voter-approved sales taxes, voter-approved parcel or property taxes,
and voter-approved bridge tolls dedicated to transportation
improvements according to the most recent available data reported to
the State Board of Equalization, the Controller, or the Bay Area Toll
Authority.
   (2) Establish a northern California and southern California share
by attributing the proportional share of revenues from voter-approved
sales taxes, voter-approved parcel or property taxes, and
voter-approved bridge tolls dedicated to transportation improvements
and imposed in counties in northern California to the northern share,
and by attributing the proportional share of revenues from
voter-approved sales taxes imposed in counties located in southern
California                                            to the southern
share. The determination of whether a county is located in northern
or southern California shall be based on the definitions set forth in
Section 187 of the Streets and Highways Code.
   (3) Program funds made available to the southern share, based on
the determination in paragraph (2), shall be distributed to the
entity responsible for programming and allocating revenues from the
sales tax in proportion to the population of the county in which the
entity is located compared to the total population of southern
California counties with voter-approved sales taxes dedicated to
transportation improvements. For the purpose of calculating
population, the commission shall use the most recent information
available from the Department of Finance.
   (4) Program funds made available to the northern share, based on
the determination in paragraph (2), shall be distributed as follows:
   (A) Program funds generated by voter-approved bridge tolls and
voter-approved parcel or property taxes dedicated to transportation
improvements shall be distributed to the entity responsible for
programming and allocating revenues from the toll or tax based on the
proportional share of revenues generated by the toll or tax by that
entity in comparison to the total revenues generated by
voter-approved sales taxes, voter-approved parcel or property taxes,
and voter-approved bridge tolls dedicated to transportation
improvements in northern California.
   (B) Program funds generated by voter-approved sales taxes
dedicated to transportation improvements shall be distributed to the
entity responsible for programming and allocating revenues from the
sales tax in proportion to the population of the county in which the
entity is located compared to the total population of the northern
California counties with voter-approved sales taxes dedicated to
transportation improvements. For the purposes of calculating
population, the commission shall use the most recent information
available from the Department of Finance.
   (b) Under this section, each fiscal year in which funds are
appropriated for the program shall constitute a funding cycle.
   (c) Each eligible applicant desiring to participate in the program
in any funding cycle under this section shall submit to the
commission all of the following:
   (1) A description of the eligible project nominated for funding,
including a description of the project's cost, scope, and specific
improvements and benefits it is anticipated to achieve.
   (2) A description of the project's current status, including the
phase of delivery the project is in at the time it is nominated for
funding and a schedule for the project's completion.
   (3) A description of how the project would support transportation
and land use planning goals within the region.
   (4) The amount of eligible local matching funds the applicant is
committing to the project.
   (5) The amount of program funds the applicant seeks from the
program for the project.
   (d) The commission shall review nominated projects under this
section and their accompanying documentation to ensure that each
nominated project meets the requirements of this article and to
confirm that each project has a commitment of the requisite amount of
eligible local matching funds as required in this article. Upon
conducting the review of the requirements and determining the
proposed projects to be in compliance with this article, the projects
shall be deemed eligible.
   (e) An eligible applicant that is identified to receive an
allocation of funds under this section, but that does not submit a
project for funding in a funding cycle, may utilize its funding share
in a subsequent funding cycle.
   (f) In addition to the requirements in subdivision (a), the
commission shall, prior to the commencement of a funding cycle,
calculate the amount of bond funds specified in subdivision (g) of
Section 8879.23 that have not been appropriated and shall establish,
using the distribution formula set forth in subdivision (a) of
Section 8879.71, projected targets for the distribution of those
funds for the purpose of planning consistent with Section 8879.501.
The commission shall annually review and revise these projected
targets.
  SEC. 79.  Section 11011.1 of the Government Code is amended to
read:
   11011.1.  (a) Notwithstanding any other provision of law, except
Article 8.5 (commencing with Section 54235) of Chapter 5 of Part 1 of
Division 2 of Title 5, the disposal of surplus state real property
by the Department of General Services shall be subject to the
requirements of this section. For purposes of this section, "surplus
state real property" means real property declared surplus by the
Legislature and directed to be disposed of by the Department of
General Services, including any real property previously declared
surplus by the Legislature but not yet disposed of by the Department
of General Services prior to the enactment of this section.
   (b) (1) The department may dispose of surplus state real property
by sale, lease, exchange, a sale combined with an exchange, or other
manner of disposition of property, as authorized by the Legislature,
upon any terms and conditions and subject to any reservations and
exceptions the department deems to be in the best interests of the
state.
   (2) (A) The Legislature finds and declares that the provision of
decent housing for all Californians is a state goal of the highest
priority. The disposal of surplus state real property is a direct and
substantial public purpose of statewide concern and will serve an
important public purpose, including mitigating the environmental
effects of state activities. Therefore, it is the intent of the
Legislature that priority be given, as specified in this section, to
the disposal of surplus state real property to housing for persons
and families of low or moderate income, where land is suitable for
housing and there is a need for housing in the community.
   (B) Surplus state real property that has been determined by the
department not to be needed by any state agency shall be offered to
any local agency, as defined in subdivision (a) of Section 54221, and
then to nonprofit affordable housing sponsors, prior to being
offered for sale to private entities or individuals. As used in this
subdivision, "nonprofit affordable housing sponsor" means any of the
following:
   (i) A nonprofit corporation incorporated pursuant to Division 2
(commencing with Section 5000) of Title 1 of the Corporations Code.
   (ii) A cooperative housing corporation which is a stock
cooperative, as defined by Section 11003.2 of the Business and
Professions Code.
   (iii) A limited-dividend housing corporation.
   (C) The department, subject to this section, shall maintain a list
of surplus state real property in a conspicuous place on its
Internet Web site. The department shall provide local agencies and,
upon request, members of the public, with electronic notification of
updates to the list of properties.
   (D) To be considered as a potential priority buyer of the surplus
state real property, a local agency or nonprofit affordable housing
sponsor shall notify the department of its interest in the surplus
state real property within 90 days of the department posting on its
Internet Web site the notice of the availability of the surplus state
real property. The local agency or nonprofit affordable housing
sponsor shall demonstrate, to the satisfaction of the department,
that the surplus state real property, or portion of that surplus
state real property, is to be used by the local agency or nonprofit
affordable housing sponsor for open space, public parks, affordable
housing projects, or development of local government-owned
facilities. When more than one local agency expresses an interest in
the surplus state real property, priority shall be given to the local
agency that intends to use the surplus state real property for
affordable housing. If no agreement or transfer of title occurs, the
priority shall next be given to the local agency that intends to use
the surplus state real property for open space, public parks, or
development of local government-owned facilities. The sales agreement
shall be executed by the local agency or nonprofit affordable
housing sponsor within 60 days after the director determines the
local agency or nonprofit affordable housing sponsor is to receive
the surplus state real property. The sale of the surplus state real
property to a local agency or nonprofit affordable housing sponsor
pursuant to this section shall be completed, and title transferred,
within 60 days of the date the department executes the sales
agreement, or, if required by law, no later than 60 days after the
State Public Works Board has authorized the sale. If the sale of a
surplus state real property to a local agency or nonprofit affordable
housing sponsor is not completed within the timeframe specified in
this subparagraph, then the department shall proceed with the process
for disposal to other private entities or individuals.
   (c) (1) If more than one local agency desires the surplus state
real property for use as an open space, a public park, or the
development of a local government-owned facility, the department
shall transfer the surplus state real property to the local agency
offering the highest price above fair market value. If more than one
local agency desires the surplus state real property for use as an
affordable housing project, the department shall transfer the surplus
state real property to the local agency offering the greatest number
of affordable housing units. If more than one nonprofit affordable
housing sponsor desires the surplus state real property for use as an
affordable housing project, the department shall transfer the
surplus state real property to the nonprofit affordable housing
sponsor offering the greatest number of affordable housing units.
   (2) If no local agency or nonprofit affordable housing sponsor is
interested, or an agreement, as provided above, is not reached, then
the disposal of the surplus state real property to private entities
or individuals shall be pursuant to a public bidding process designed
to obtain the highest most certain return for the state from a
responsible bidder, and any transaction based on such a bidding
process shall be deemed to be the fair market value for the purposes
of the reporting requirements pursuant to subdivision (d).
   (3) Notwithstanding any other provision of law, the department may
sell surplus state real property, or a portion of surplus state real
property, to a local agency, or to a nonprofit affordable housing
sponsor if no local agency is interested in the surplus state real
property, for affordable housing projects at a sales price less than
fair market value if the department determines that such a discount
will enable the provision of housing for persons and families of low
or moderate income. Nothing shall preclude a local agency that
purchases the surplus state real property for affordable housing from
reconveying the surplus state real property to a nonprofit
affordable housing sponsor for development of affordable housing.
Transfer of title to the surplus state real property or lease of the
surplus state real property for affordable housing shall be
conditioned upon continued use of the surplus state real property as
housing for persons and families of low and moderate income for at
least 40 years and the department shall record a regulatory agreement
that imposes affordability covenants, conditions, and restrictions
on the surplus state real property. The regulatory agreement shall be
a first priority lien on the surplus state real property and last
for a period of at least 40 years, and if another state agency is
lending funds for a project, a combined regulatory agreement shall be
utilized. Notwithstanding any other provision of law, the regulatory
agreement shall not be subordinated to any other lien or encumbrance
except for any federal loan program the statutes or regulations of
which require a first priority lien for that federal loan.
   (4) Notwithstanding any other provision of law, the Director of
General Services may transfer surplus state real property to a local
agency for less than fair market value if the local agency uses the
surplus state real property for parks or open-space purposes. The
deed or other instrument of transfer shall provide that the surplus
state real property would revert to the state if the use changed to a
use other than parks or open-space purposes during the period of 25
years after the transfer date. For the purpose of this paragraph,
"open-space purposes" means the use of land for public recreation,
enjoyment of scenic beauty, or conservation or use of natural
resources.
   (d) Thirty days prior to executing a transaction for a sale,
lease, exchange, a sale combined with an exchange, or other manner of
disposition of the surplus state real property for less than fair
market value or for affordable housing, or as authorized by the
Legislature, the Director of General Services shall report to the
chairpersons of the fiscal committees of the Legislature all of the
following:
   (1) The financial terms of the transaction.
   (2) A comparison of fair market value for the surplus state real
property and the terms listed in paragraph (1).
   (3) The basis for agreeing to terms and conditions other than fair
market value.
   (e) As to surplus state real property sold or exchanged pursuant
to this section, the director shall except and reserve to the state
all mineral deposits, as described in Section 6407 of the Public
Resources Code, together with the right to prospect for, mine, and
remove the deposits. If, however, the director determines that there
is little or no potential for mineral deposits, the reservation may
be without surface right of entry above a depth of 500 feet, or the
rights to prospect for, mine, and remove the deposits shall be
limited to those areas of the surplus state real property conveyed
that the director determines to be reasonably necessary for the
removal of the deposits.
   (f) The failure to comply with this section, except for
subdivision (d), shall not invalidate the transfer or conveyance of
surplus state real property to a purchaser for value.
   (g) For purposes of this section, fair market value is established
by an appraisal and economic evaluation conducted by the department
or approved by the department.
  SEC. 80.  Section 11011.2 of the Government Code is amended to
read:
   11011.2.  (a) (1) Notwithstanding any other law, including, but
not limited to, Sections 11011 and 14670, except as provided in this
section, the Department of General Services may lease real property
under the jurisdiction of a state agency, department, or district
agricultural association, if the Director of General Services
determines that the real property is of no immediate need to the
state but may have some potential future use to the program needs of
the agency, department, or district agricultural association.
   (2) The Director of General Services may not lease any of the
following real property pursuant to this section:
   (A) Tax-deeded land or lands under the jurisdiction of the State
Lands Commission.
   (B) Land that has escheated to the state or that has been
distributed to the state by court decree in estates of deceased
persons.
   (C) Lands under the jurisdiction of the State Coastal Conservancy
or another state conservancy.
   (D) Lands under the jurisdiction of the Department of
Transportation or the California State University system, or land
owned by the Regents of the University of California.
   (E) Lands under the jurisdiction of the Department of Parks and
Recreation.
   (F) Lands under the jurisdiction of the Department of Fish and
Game.
   (3) A lease entered into pursuant to this section shall be set at
the amount of the lease's fair market value, as determined by the
Director of General Services. The Director of General Services may
determine the length of term or a use of the lease, and specify any
other terms and conditions which are determined to be in the best
interest of the state.
   (b) The Department of General Services may enter into a long-term
lease of real property pursuant to this section that has outstanding
lease revenue bonds and for which the real property cannot be
disencumbered from the bonds, only if the issuer and trustee for the
bonds approves the lease transaction, and this approval takes into
consideration, among other things, that the proposed lease
transaction does not breach a covenant or obligation of the issuer or
trustee.
   (c) (1) All issuer- and trustee-related costs for reviewing a
proposed lease transaction pursuant to this section, and all other
costs of the lease transaction related to the defeasance or other
retirement of any bonds, including the cost of nationally recognized
bond counsel, shall be paid from the proceeds of that lease.
   (2) The Department of General Services shall be reimbursed for any
reasonable costs or expenses incurred in conducting a transaction
pursuant to this section.
   (3) Notwithstanding subdivision (g) of Section 11011, the
Department of General Services shall deposit into the General Fund
the net proceeds of a lease entered into pursuant to this section,
after deducting the amount of the reimbursement of costs incurred
pursuant to this section or the reimbursement of adjustments to the
General Fund loan made pursuant to Section 8 of Chapter 20 of the
2009-10 Fourth Extraordinary Session from the lease.
   (d) The Department of General Services shall transmit a report to
each house of the Legislature on or before June 30, 2011, and on or
before June 30 each year thereafter, listing every new lease that
exceeds a period of five years entered into under the authority of
this section and the following information regarding each listed
lease:
   (1) Lease payments.
   (2) Length of the lease.
   (3) Identification of the leasing parties.
   (4) Identification of the leased property.
   (5) Any other information the Director of General Services
determines should be included in the report to adequately describe
the material provisions of the lease.
  SEC. 81.  Section 11126 of the Government Code is amended to read:
   11126.  (a) (1) This article does not prevent a state body from
holding closed sessions during a regular or special meeting to
consider the appointment, employment, evaluation of performance, or
dismissal of a public employee or to hear complaints or charges
brought against that employee by another person or employee unless
the employee requests a public hearing.
   (2) As a condition of holding a closed session on the complaints
or charges to consider disciplinary action or to consider dismissal,
the employee shall be given written notice of his or her right to
have a public hearing, rather than a closed session, and that notice
shall be delivered to the employee personally or by mail at least 24
hours before the time for holding a regular or special meeting. If
notice is not given, any disciplinary or other action taken against
an employee at the closed session shall be null and void.
   (3) The state body also may exclude from a public or closed
session, during the examination of a witness, any or all other
witnesses in the matter being investigated by the state body.
   (4) Following the public hearing or closed session, the body may
deliberate on the decision to be reached in a closed session.
   (b) For purposes of this section, "employee" does not include a
person who is elected to, or appointed to a public office by, a state
body. However, officers of the California State University who
receive compensation for their services, other than per diem and
ordinary and necessary expenses, shall, when engaged in that
capacity, be considered employees. Furthermore, for purposes of this
section, "employee" includes a person exempt from civil service
pursuant to subdivision (e) of Section 4 of Article VII of the
California Constitution.
   (c) This article does not do any of the following:
   (1) Prevent state bodies that administer the licensing of persons
engaging in businesses or professions from holding closed sessions to
prepare, approve, grade, or administer examinations.
   (2) Prevent an advisory body of a state body that administers the
licensing of persons engaged in businesses or professions from
conducting a closed session to discuss matters that the advisory body
has found would constitute an unwarranted invasion of the privacy of
an individual licensee or applicant if discussed in an open meeting,
provided that the advisory body does not include a quorum of the
members of the state body it advises. Those matters may include
review of an applicant's qualifications for licensure and an inquiry
specifically related to the state body's enforcement program
concerning an individual licensee or applicant where the inquiry
occurs prior to the filing of a civil, criminal, or administrative
disciplinary action against the licensee or applicant by the state
body.
   (3) Prohibit a state body from holding a closed session to
deliberate on a decision to be reached in a proceeding required to be
conducted pursuant to Chapter 5 (commencing with Section 11500) or
similar provisions of law.
   (4) Grant a right to enter a correctional institution or the
grounds of a correctional institution if that right is not otherwise
granted by law, and this article does not prevent a state body from
holding a closed session when considering and acting upon the
determination of a term, parole, or release of an individual or other
disposition of an individual case, or if public disclosure of the
subjects under discussion or consideration is expressly prohibited by
statute.
   (5) Prevent a closed session to consider the conferring of
honorary degrees, or gifts, donations, and bequests that the donor or
proposed donor has requested in writing to be kept confidential.
   (6) Prevent the Alcoholic Beverage Control Appeals Board from
holding a closed session for the purpose of holding a deliberative
conference as provided in Section 11125.
   (7) (A) Prevent a state body from holding closed sessions with its
negotiator prior to the purchase, sale, exchange, or lease of real
property by or for the state body to give instructions to its
negotiator regarding the price and terms of payment for the purchase,
sale, exchange, or lease.
   (B) However, prior to the closed session, the state body shall
hold an open and public session in which it identifies the real
property or real properties that the negotiations may concern and the
person or persons with whom its negotiator may negotiate.
   (C) For purposes of this paragraph, the negotiator may be a member
of the state body.
   (D) For purposes of this paragraph, "lease" includes renewal or
renegotiation of a lease.
   (E) This paragraph does not preclude a state body from holding a
closed session for discussions regarding eminent domain proceedings
pursuant to subdivision (e).
   (8) Prevent the California Postsecondary Education Commission from
holding closed sessions to consider matters pertaining to the
appointment or termination of the Director of the California
Postsecondary Education Commission.
   (9) Prevent the Bureau for Private Postsecondary Education from
holding closed sessions to consider matters pertaining to the
appointment or termination of the Executive Director of the Bureau
for Private Postsecondary Education.
   (10) Prevent the Franchise Tax Board from holding closed sessions
for the purpose of discussion of confidential tax returns or
information the public disclosure of which is prohibited by law, or
from considering matters pertaining to the appointment or removal of
the Executive Officer of the Franchise Tax Board.
   (11) Require the Franchise Tax Board to notice or disclose any
confidential tax information considered in closed sessions, or
documents executed in connection therewith, the public disclosure of
which is prohibited pursuant to Article 2 (commencing with Section
19542) of Chapter 7 of Part 10.2 of Division 2 of the Revenue and
Taxation Code.
   (12) Prevent the Corrections Standards Authority from holding
closed sessions when considering reports of crime conditions under
Section 6027 of the Penal Code.
   (13) Prevent the State Air Resources Board from holding closed
sessions when considering the proprietary specifications and
performance data of manufacturers.
   (14) Prevent the State Board of Education or the Superintendent of
Public Instruction, or a committee advising the board or the
Superintendent, from holding closed sessions on those portions of its
review of assessment instruments pursuant to Chapter 5 (commencing
with Section 60600) of, or pursuant to Chapter 9 (commencing with
Section 60850) of, Part 33 of Division 4 of Title 2 of the Education
Code during which actual test content is reviewed and discussed. The
purpose of this provision is to maintain the confidentiality of the
assessments under review.
   (15) Prevent the California Integrated Waste Management Board or
its auxiliary committees from holding closed sessions for the purpose
of discussing confidential tax returns, discussing trade secrets or
confidential or proprietary information in its possession, or
discussing other data, the public disclosure of which is prohibited
by law.
   (16) Prevent a state body that invests retirement, pension, or
endowment funds from holding closed sessions when considering
investment decisions. For purposes of consideration of shareholder
voting on corporate stocks held by the state body, closed sessions
for the purposes of voting may be held only with respect to election
of corporate directors, election of independent auditors, and other
financial issues that could have a material effect on the net income
of the corporation. For purposes of real property investment
decisions that may be considered in a closed session pursuant to this
paragraph, a state body shall also be exempt from the provisions of
paragraph (7) relating to the identification of real properties prior
to the closed session.
   (17) Prevent a state body, or boards, commissions, administrative
officers, or other representatives that may properly be designated by
law or by a state body, from holding closed sessions with its
representatives in discharging its responsibilities under Chapter 10
(commencing with Section 3500), Chapter 10.3 (commencing with Section
3512), Chapter 10.5 (commencing with Section 3525), or Chapter 10.7
(commencing with Section 3540) of Division 4 of Title 1 as the
sessions relate to salaries, salary schedules, or compensation paid
in the form of fringe benefits. For the purposes enumerated in the
                                            preceding sentence, a
state body also may meet with a state conciliator who has intervened
in the proceedings.
   (18) (A) Prevent a state body from holding closed sessions to
consider matters posing a threat or potential threat of criminal or
terrorist activity against the personnel, property, buildings,
facilities, or equipment, including electronic data, owned, leased,
or controlled by the state body, where disclosure of these
considerations could compromise or impede the safety or security of
the personnel, property, buildings, facilities, or equipment,
including electronic data, owned, leased, or controlled by the state
body.
   (B) Notwithstanding any other provision of law, a state body, at
any regular or special meeting, may meet in a closed session pursuant
to subparagraph (A) upon a two-thirds vote of the members present at
the meeting.
   (C) After meeting in closed session pursuant to subparagraph (A),
the state body shall reconvene in open session prior to adjournment
and report that a closed session was held pursuant to subparagraph
(A), the general nature of the matters considered, and whether action
was taken in closed session.
   (D) After meeting in closed session pursuant to subparagraph (A),
the state body shall submit to the Legislative Analyst written
notification stating that it held this closed session, the general
reason or reasons for the closed session, the general nature of the
matters considered, and whether action was taken in closed session.
The Legislative Analyst shall retain for no less than four years
written notification received from a state body pursuant to this
subparagraph.
   (d) (1) Notwithstanding any other provision of law, a meeting of
the Public Utilities Commission at which the rates of entities under
the commission's jurisdiction are changed shall be open and public.
   (2) This article does not prevent the Public Utilities Commission
from holding closed sessions to deliberate on the institution of
proceedings, or disciplinary actions against any person or entity
under the jurisdiction of the commission.
   (e) (1) This article does not prevent a state body, based on the
advice of its legal counsel, from holding a closed session to confer
with, or receive advice from, its legal counsel regarding pending
litigation when discussion in open session concerning those matters
would prejudice the position of the state body in the litigation.
   (2) For purposes of this article, all expressions of the
lawyer-client privilege other than those provided in this subdivision
are hereby abrogated. This subdivision is the exclusive expression
of the lawyer-client privilege for purposes of conducting closed
session meetings pursuant to this article. For purposes of this
subdivision, litigation shall be considered pending when any of the
following circumstances exist:
   (A) An adjudicatory proceeding before a court, an administrative
body exercising its adjudicatory authority, a hearing officer, or an
arbitrator, to which the state body is a party, has been initiated
formally.
   (B) (i) A point has been reached where, in the opinion of the
state body on the advice of its legal counsel, based on existing
facts and circumstances, there is a significant exposure to
litigation against the state body.
   (ii) Based on existing facts and circumstances, the state body is
meeting only to decide whether a closed session is authorized
pursuant to clause (i).
   (C) (i) Based on existing facts and circumstances, the state body
has decided to initiate or is deciding whether to initiate
litigation.
   (ii) The legal counsel of the state body shall prepare and submit
to it a memorandum stating the specific reasons and legal authority
for the closed session. If the closed session is pursuant to
paragraph (1), the memorandum shall include the title of the
litigation. If the closed session is pursuant to subparagraph (A) or
(B), the memorandum shall include the existing facts and
circumstances on which it is based. The legal counsel shall submit
the memorandum to the state body prior to the closed session, if
feasible, and in any case no later than one week after the closed
session. The memorandum shall be exempt from disclosure pursuant to
Section 6254.25.
   (iii) For purposes of this subdivision, "litigation" includes any
adjudicatory proceeding, including eminent domain, before a court,
administrative body exercising its adjudicatory authority, hearing
officer, or arbitrator.
   (iv) Disclosure of a memorandum required under this subdivision is
not a waiver of the lawyer-client privilege, as provided for under
Article 3 (commencing with Section 950) of Chapter 4 of Division 8 of
the Evidence Code.
   (f) In addition to subdivisions (a), (b), and (c), this article
does not do any of the following:
   (1) Prevent a state body operating under a joint powers agreement
for insurance pooling from holding a closed session to discuss a
claim for the payment of tort liability or public liability losses
incurred by the state body or a member agency under the joint powers
agreement.
   (2) Prevent the examining committee established by the State Board
of Forestry and Fire Protection, pursuant to Section 763 of the
Public Resources Code, from conducting a closed session to consider
disciplinary action against an individual professional forester prior
to the filing of an accusation against the forester pursuant to
Section 11503.
   (3) Prevent an administrative committee established by the
California Board of Accountancy pursuant to Section 5020 of the
Business and Professions Code from conducting a closed session to
consider disciplinary action against an individual accountant prior
to the filing of an accusation against the accountant pursuant to
Section 11503. This article does not prevent an examining committee
established by the California Board of Accountancy pursuant to
Section 5023 of the Business and Professions Code from conducting a
closed hearing to interview an individual applicant or accountant
regarding the applicant's qualifications.
   (4) Prevent a state body, as defined in subdivision (b) of Section
11121, from conducting a closed session to consider a matter that
properly could be considered in closed session by the state body the
authority of which it exercises.
   (5) Prevent a state body, as defined in subdivision (d) of Section
11121, from conducting a closed session to consider a matter that
properly could be considered in a closed session by the body defined
as a state body pursuant to subdivision (a) or (b) of Section 11121.
   (6) Prevent a state body, as defined in subdivision (c) of Section
11121, from conducting a closed session to consider a matter that
properly could be considered in a closed session by the state body it
advises.
   (7) Prevent the State Board of Equalization from holding closed
sessions for either of the following:
   (A) When considering matters pertaining to the appointment or
removal of the Executive Secretary of the State Board of
Equalization.
   (B) For the purpose of hearing confidential taxpayer appeals or
data, the public disclosure of which is prohibited by law.
   (8) Require the State Board of Equalization to disclose action
taken in closed session or documents executed in connection with that
action, the public disclosure of which is prohibited by law pursuant
to Sections 15619 and 15641 of this code and Sections 833, 7056,
8255, 9255, 11655, 30455, 32455, 38705, 38706, 43651, 45982, 46751,
50159, 55381, and 60609 of the Revenue and Taxation Code.
   (9) Prevent the California Earthquake Prediction Evaluation
Council, or other body appointed to advise the Secretary of
California Emergency Management or the Governor concerning matters
relating to volcanic or earthquake predictions, from holding closed
sessions when considering the evaluation of possible predictions.
   (g) This article does not prevent either of the following:
   (1) The Teachers' Retirement Board or the Board of Administration
of the Public Employees' Retirement System from holding closed
sessions when considering matters pertaining to the recruitment,
appointment, employment, or removal of the chief executive officer or
when considering matters pertaining to the recruitment or removal of
the Chief Investment Officer of the State Teachers' Retirement
System or the Public Employees' Retirement System.
   (2) The Commission on Teacher Credentialing from holding closed
sessions when considering matters relating to the recruitment,
appointment, or removal of its executive director.
   (h) This article does not prevent the Board of Administration of
the Public Employees' Retirement System from holding closed sessions
when considering matters relating to the development of rates and
competitive strategy for plans offered pursuant to Chapter 15
(commencing with Section 21660) of Part 3 of Division 5 of Title 2.
   (i) This article does not prevent the Managed Risk Medical
Insurance Board from holding closed sessions when considering matters
related to the development of rates and contracting strategy for
entities contracting or seeking to contract with the board pursuant
to Part 6.2 (commencing with Section 12693), Part 6.3 (commencing
with Section 12695), Part 6.4 (commencing with Section 12699.50), or
Part 6.5 (commencing with Section 12700) of Division 2 of the
Insurance Code.
   (j) Nothing in this article shall be construed to prevent the
board of the State Compensation Insurance Fund from holding closed
sessions in the following:
   (1) When considering matters related to claims pursuant to Chapter
1 (commencing with Section 3200) of Part 1 of Division 4 of the
Labor Code, to the extent that confidential medical information or
other individually identifiable information would be disclosed.
   (2) To the extent that matters related to audits and
investigations that have not been completed would be disclosed.
   (3) To the extent that an internal audit containing proprietary
information would be disclosed.
   (4) To the extent that the session would address the development
of rates, contracting strategy, underwriting, or competitive
strategy, pursuant to the powers granted to the board in Chapter 4
(commencing with Section 11770) of Part 3 of Division 2 of the
Insurance Code, when discussion in open session concerning those
matters would prejudice the position of the State Compensation
Insurance Fund.
   (k) The State Compensation Insurance Fund shall comply with the
procedures specified in Section 11125.4 with respect to any closed
session or meeting authorized by subdivision (j), and in addition
shall provide an opportunity for a member of the public to be heard
on the issue of the appropriateness of closing the meeting or
session.
  SEC. 82.  Section 12715 of the Government Code is amended to read:
   12715.  (a) The Controller, acting in consultation with the
California Gambling Control Commission, shall divide the County
Tribal Casino Account for each county that has gaming devices that
are subject to an obligation to make contributions to the Indian
Gaming Special Distribution Fund into a separate account for each
tribe that operates a casino within the county. These accounts shall
be known as Individual Tribal Casino Accounts, and funds may be
released from these accounts to make grants selected by an Indian
Gaming Local Community Benefit Committee pursuant to the method
established by this section to local jurisdictions impacted by tribal
casinos. Each Individual Tribal Casino Account shall be funded in
proportion to the amount that each individual tribe paid in the prior
fiscal year to the Indian Gaming Special Distribution Fund.
   (b) (1) There is hereby created in each county in which Indian
gaming is conducted an Indian Gaming Local Community Benefit
Committee. The selection of all grants from each Individual Tribal
Casino Account or County Tribal Casino Account shall be made by each
county's Indian Gaming Local Community Benefit Committee. In
selecting grants, the Indian Gaming Local Community Benefit Committee
shall follow the priorities established in subdivision (g) and the
requirements specified in subdivision (h). This committee has the
following additional responsibilities:
   (A) Establishing all application policies and procedures for
grants from the Individual Tribal Casino Account or County Tribal
Casino Account.
   (B) Assessing the eligibility of applications for grants from
local jurisdictions impacted by tribal gaming operations.
   (C) Determining the appropriate amount for reimbursement from the
aggregate county tribal account of the demonstrated costs incurred by
the county for administering the grant programs. The reimbursement
for county administrative costs may not exceed 2 percent of the
aggregate county tribal account in any given fiscal year.
   (2) Except as provided in Section 12715.5, the Indian Gaming Local
Community Benefit Committee shall be composed of seven
representatives, consisting of the following:
   (A) Two representatives from the county, selected by the county
board of supervisors.
   (B) Three elected representatives from cities located within four
miles of a tribal casino in the county, selected by the county board
of supervisors. In the event that there are no cities located within
four miles of a tribal casino in the county, other local
representatives may be selected upon mutual agreement by the county
board of supervisors and a majority of the tribes paying into the
Indian Gaming Special Distribution Fund in the county. When there are
no cities within four miles of a tribal casino in the county, and
when the Indian Gaming Local Community Benefit Committee acts on
behalf of a county where no tribes pay into the Indian Gaming Special
Distribution Fund, other local representatives may be selected upon
mutual agreement by the county board of supervisors and a majority of
the tribes operating casinos in the county. However, if only one
city is within four miles of a tribal casino and that same casino is
located entirely within the unincorporated area of that particular
county, only one elected representative from that city shall be
included on the Indian Gaming Local Community Benefit Committee.
   (C) Two representatives selected upon the recommendation of a
majority of the tribes paying into the Indian Gaming Special
Distribution Fund in each county. When an Indian Gaming Local
Community Benefit Committee acts on behalf of a county where no
tribes pay into the Indian Gaming Special Distribution Fund, the two
representatives may be selected upon the recommendation of the tribes
operating casinos in the county.
   (c) Sixty percent of each Individual Tribal Casino Account shall
be available for nexus grants on a yearly basis to cities and
counties impacted by tribes that are paying into the Indian Gaming
Special Distribution Fund, according to the four-part nexus test
described in paragraph (1). Grant awards shall be selected by each
county's Indian Gaming Local Community Benefit Committee and shall be
administered by the county. Grants may be awarded on a multiyear
basis, and these multiyear grants shall be accounted for in the grant
process for each year.
   (1) A nexus test based on the geographical proximity of a local
government jurisdiction to an individual Indian land upon which a
tribal casino is located shall be used by each county's Indian Gaming
Local Community Benefit Committee to determine the relative priority
for grants, using the following criteria:
   (A) Whether the local government jurisdiction borders the Indian
lands on all sides.
   (B) Whether the local government jurisdiction partially borders
Indian lands.
   (C) Whether the local government jurisdiction maintains a highway,
road, or other thoroughfare that is the predominant access route to
a casino that is located within four miles.
   (D) Whether all or a portion of the local government jurisdiction
is located within four miles of a casino.
   (2) Fifty percent of the amount specified in subdivision (c) shall
be awarded in equal proportions to local government jurisdictions
that meet all four of the nexus test criteria in paragraph (1). If no
eligible local government jurisdiction satisfies this requirement,
the amount specified in this paragraph shall be made available for
nexus grants in equal proportions to local government jurisdictions
meeting the requirements of paragraph (3) or (4).
   (3) Thirty percent of the amount specified in subdivision (c)
shall be awarded in equal proportions to local government
jurisdictions that meet three of the nexus test criteria in paragraph
(1). If no eligible local government jurisdiction satisfies this
requirement, the amount specified in this paragraph shall be made
available for nexus grants in equal proportions to local government
jurisdictions meeting the requirements of paragraph (2) or (4).
   (4) Twenty percent of the amount specified in subdivision (c)
shall be awarded in equal proportions to local government
jurisdictions that meet two of the nexus test criteria in paragraph
(1). If no eligible local government jurisdiction satisfies this
requirement, the amount specified in this paragraph shall be made
available for nexus grants in equal proportions to local government
jurisdictions meeting the requirements of paragraph (2) or (3).
   (d) Twenty percent of each Individual Tribal Casino Account shall
be available for discretionary grants to local jurisdictions impacted
by tribes that are paying into the Indian Gaming Special
Distribution Fund. These discretionary grants shall be made available
to all local jurisdictions in the county irrespective of any nexus
to impacts from any particular tribal casino, as described in
paragraph (1) of subdivision (c). Grant awards shall be selected by
each county's Indian Gaming Local Community Benefit Committee and
shall be administered by the county. Grants may be awarded on a
multiyear basis, and these multiyear grants shall be accounted for in
the grant process for each year.
   (e) (1) Twenty percent of each Individual Tribal Casino Account
shall be available for discretionary grants to local jurisdictions
impacted by tribes that are not paying into the Indian Gaming Special
Distribution Fund. These grants shall be made available to local
jurisdictions in the county irrespective of any nexus to impacts from
any particular tribal casino, as described in paragraph (1) of
subdivision (c), and irrespective of whether the impacts presented
are from a tribal casino that is not paying into the Indian Gaming
Special Distribution Fund. Grant awards shall be selected by each
county's Indian Gaming Local Community Benefit Committee and shall be
administered by the county. Grants may be awarded on a multiyear
basis, and these multiyear grants shall be accounted for in the grant
process for each year.
   (A) Grants awarded pursuant to this subdivision are limited to
addressing service-oriented impacts and providing assistance with
one-time large capital projects related to Indian gaming impacts.
   (B) Grants shall be subject to the sole sponsorship of the tribe
that pays into the Indian Gaming Special Distribution Fund and the
recommendations of the Indian Gaming Local Community Benefit
Committee for that county.
   (2) If an eligible county does not have a tribal casino operated
by a tribe that does not pay into the Indian Gaming Special
Distribution Fund, the moneys available for discretionary grants
under this subdivision shall be available for distribution pursuant
to subdivision (d).
   (f) (1) For each county that does not have gaming devices subject
to an obligation to make payments to the Indian Gaming Special
Distribution Fund, funds may be released from the county's County
Tribal Casino Account to make grants selected by the county's Indian
Gaming Local Community Benefit Committee pursuant to the method
established by this section to local jurisdictions impacted by tribal
casinos. These grants shall be made available to local jurisdictions
in the county irrespective of any nexus to any particular tribal
casino. These grants shall follow the priorities specified in
subdivision (g) and the requirements specified in subdivision (h).
   (2) Funds not allocated from a county tribal casino account by the
end of each fiscal year shall revert back to the Indian Gaming
Special Distribution Fund. Moneys allocated for the 2003-04 fiscal
year shall be eligible for expenditure through December 31, 2004.
   (g) The following uses shall be the priorities for the receipt of
grant moneys from Individual Tribal Casino Accounts: law enforcement,
fire services, emergency medical services, environmental impacts,
water supplies, waste disposal, behavioral, health, planning and
adjacent land uses, public health, roads, recreation and youth
programs, and child care programs.
   (h) In selecting grants pursuant to subdivision (b), an Indian
Gaming Local Community Benefit Committee shall select only grant
applications that mitigate impacts from casinos on local
jurisdictions. If a local jurisdiction uses a grant selected pursuant
to subdivision (b) for any unrelated purpose, the grant shall
terminate immediately and any moneys not yet spent shall revert to
the Indian Gaming Special Distribution Fund. If a local jurisdiction
approves an expenditure that mitigates an impact from a casino on a
local jurisdiction and that also provides other benefits to the local
jurisdiction, the grant selected pursuant to subdivision (b) shall
be used to finance only the proportionate share of the expenditure
that mitigates the impact from the casino.
   (i) All grants from Individual Tribal Casino Accounts shall be
made only upon the affirmative sponsorship of the tribe paying into
the Indian Gaming Special Distribution Fund from whose Individual
Tribal Casino Account the grant moneys are available for
distribution. Tribal sponsorship shall confirm that the grant
application has a reasonable relationship to a casino impact and
satisfies at least one of the priorities listed in subdivision (g). A
grant may not be made for any purpose that would support or fund,
directly or indirectly, any effort related to the opposition or
challenge to Indian gaming in the state, and, to the extent any
awarded grant is utilized for any prohibited purpose by any local
government, upon notice given to the county by any tribe from whose
Individual Tribal Casino Account the awarded grant went toward that
prohibited use, the grant shall terminate immediately and any moneys
not yet used shall again be made available for qualified nexus
grants.
   (j) A local government jurisdiction that is a recipient of a grant
from an Individual County Tribal Casino Account or a County Tribal
Casino Account shall provide notice to the public, either through a
slogan, signage, or other mechanism, stating that the local
government project has received funding from the Indian Gaming
Special Distribution Fund and further identifying the particular
Individual Tribal Casino Account from which the grant derives.
   (k) (1) Each county's Indian Gaming Local Community Benefit
Committee shall submit to the Controller a list of approved projects
for funding from Individual Tribal Casino Accounts. Upon receipt of
this list, the Controller shall release the funds directly to the
local government entities for which a grant has been approved by the
committee.
   (2) Funds not allocated from an Individual Tribal Casino Account
by the end of each fiscal year shall revert back to the Indian Gaming
Special Distribution Fund. Moneys allocated for the 2003-04 fiscal
year shall be eligible for expenditure through December 31, 2004.
Moneys allocated for the 2008-09 fiscal year shall be eligible for
expenditure through December 31, 2009.
   (l) Notwithstanding any other law, a local government jurisdiction
that receives a grant from an Individual Tribal Casino Account shall
deposit all funds received in an interest-bearing account and use
the interest from those funds only for the purpose of mitigating an
impact from a casino. If any portion of the funds in the account is
used for any other purpose, the remaining portion shall revert to the
Indian Gaming Special Distribution Fund. As a condition of receiving
further funds under this section, a local government jurisdiction,
upon request of the county, shall demonstrate to the county that all
expenditures made from the account have been in compliance with the
requirements of this section.
  SEC. 83.  Section 13302 of the Government Code is amended to read:
   13302.  The accounting system devised as provided in Section 13300
shall provide, with respect to the General Fund and other
governmental funds, for all of the following:
   (a) The accrual of expenditures as of the end of each fiscal year
on the basis of payables incurred, excluding accrued interest on
general obligation bonded indebtedness.
   (b) (1) The accrual of revenues at the end of the fiscal year if
the underlying transaction has occurred as of the last day of the
fiscal year, the amount is measurable, and the actual collection will
occur either during the current period or after the end of the
current period but in time to pay current yearend liabilities.
   (2) Cash in agency trust accounts within the centralized State
Treasury system that is in transit to the State Treasury, accrued
interest receivable, and accounts receivable shall be accrued as of
the end of each fiscal year.
   (c) For the purposes of financial reporting, both of the following
shall apply:
   (1) A payable exists when goods or services have been delivered
and the state is required to pay for those goods or services, and an
encumbrance exists when a valid obligation against an appropriation
has been created.
   (2) All funds appropriated shall be identified as either expended,
payable, encumbered (exclusive of payables), or unencumbered, as
further defined by the California Fiscal Advisory Board, and the
total of these shall equal the total appropriation.
   (d) (1) Notwithstanding any other law, and except as provided in
paragraph (2), payments to employees made through the Uniform State
Payroll System as described in Section 12472.5 with an issue date
each year of July 1 shall be considered payables incurred in the
fiscal year in which the payment is issue dated.
   (2) Notwithstanding paragraph (1), for purposes of calculating
maintenance of effort expenditures under Section 8 of Article XVI of
the California Constitution, or for purposes of calculating funds
used by a program during the fiscal year, payments made on July 1 may
be counted towards the prior fiscal year.
  SEC. 84.  Section 15491 of the Government Code is amended to read:
   15491.  (a) The State Allocation Board shall provide for live
video and audio transmission of all board meetings and hearings that
are open to the public through a technology that is accessible to as
large a segment of the public as possible, including, but not limited
to, the use of any of the following technologies:
   (1) Cable, satellite, over-the-air, or any other type of
transmission that can be accessed through a television.
   (2) Web cast.
   (b) The board shall ensure that any Web cast transmission
implemented pursuant to subdivision (a) may be transmitted over and
accessed through the K-12 High-Speed Network established pursuant to
paragraph (2) of subdivision (b) of Section 11800 of the Education
Code.
   (c) The board shall consult with the State Chief Information
Officer for the purposes of implementing this section pursuant to the
duties that the State Chief Information Officer is required to
perform, as described in Section 11545.
  SEC. 85.  Section 15820.911 of the Government Code is amended to
read:
   15820.911.  (a) The Department of Corrections and Rehabilitation,
a participating county, and the board are authorized to acquire,
design, and construct a local jail facility approved by the
Corrections Standards Authority pursuant to Section 15820.916, or a
site or sites owned by, or subject to a lease or option to purchase
held by, a participating county. The ownership interest of a
participating county in the site or sites for a local jail facility
must be determined by the board to be adequate for purposes of its
financing in order to be eligible under this chapter.
   (b) Notwithstanding Section 15815, a participating county may
acquire, design, or construct the local jail facility in accordance
with its local contracting authority. Notwithstanding Section 14951,
the participating county may assign an inspector during the
construction of the project.
   (c) The department, a participating county, and the board shall
enter into a construction agreement for these projects that shall
provide, at a minimum, performance expectations of the parties
related to the acquisition, design, construction, or renovation of
the local jail facility; guidelines and criteria for use and
application of the proceeds of revenue bonds, notes, or bond
anticipation notes issued by the board to pay for the cost of the
approved local jail facility project; and ongoing maintenance and
staffing responsibilities for the term of the financing.
   (d) The construction agreement shall include a provision that the
participating county agrees to indemnify, defend, and save harmless
the State of California for any and all claims and losses arising out
of the acquisition, design, and construction of the project. The
construction agreement may also contain additional terms and
conditions that facilitate the financing by the board.
   (e) The scope and cost of these approved local jail facility
projects shall be subject to approval and administrative oversight by
the board.
   (f) For purposes of compliance with the California Environmental
Quality Act (Division 13 (commencing with Section 21000) of the
Public Resources Code), neither the board nor the department shall be
deemed a lead or responsible agency; the participating county is the
lead agency.
  SEC. 86.  Section 16724.5 of the Government Code is amended to
read:
   16724.5.  (a) For purposes of this section, "revolving fund" means
the General Obligation Bond Expense Revolving Fund created pursuant
to this section.
   (b) There is in the State Treasury the General Obligation Bond
Expense Revolving Fund, which shall consist of all moneys
appropriated by the Legislature into that fund or payable into that
fund in accordance with this section.
   (c) All moneys in the revolving fund are hereby appropriated and
shall be available without regard to fiscal years for all of the
following:
   (1) The payment of the expenses incurred by the Treasurer in
having the bonds prepared and in advertising their sale or their
prior redemption, and of the other costs described in subdivision (e)
of Section 16727.
   (2) For expenses incurred by the committee pursuant to Section
16758.
   (3) For payment for legal services pursuant to Section 16760.
   (d) Whenever bonds are sold, out of the first moneys realized from
their sale, there shall be redeposited in the revolving fund the
sums that have been expended for the purposes specified in
subdivision (c), which may be used for the same purposes and repaid
in the same manner whenever additional sales are made.
  SEC. 87.  Section 16731.6 of the Government Code is amended to
read:
   16731.6.  (a) Notwithstanding any other provision of this chapter,
and as an alternative to the procedures set forth in Section 16731,
the committee may provide for the issuance of all or part of the
bonds authorized to be issued as commercial paper notes. The
committee shall adopt a resolution finding that issuance of the bonds
in the form of commercial paper notes is necessary and desirable,
directing the Treasurer to arrange for preparation of the requisite
number of suitable notes, and specifying other provisions relating to
the commercial paper notes, including all of the following:
   (1) For each program of commercial paper notes authorized, the
resolution shall contain the final date of maturity and the total
aggregate principal amount of the commercial paper notes authorized
to be outstanding at any one time up to the maturity date, in
accordance with all of the following:
   (A) The resolution may provide that the commercial paper notes may
be issued and renewed from time to time until the final maturity
date, and that the amount issued from time to time may be set by the
Treasurer up to the maximum amount authorized to be outstanding at
any one time.
   (B) The resolution shall include methods of setting the dates,
numbers, and denominations of the commercial paper notes.
   (C) The determination of the final maturity date and total amount
by the committee shall be made upon recommendation of the Treasurer
to meet the needs of the state for funds, to provide the maximum
benefit to potential purchasers, and to respond to the expected
demand for the commercial paper notes.
   (D) Notwithstanding any other provision of this chapter, whenever
the committee determines to issue commercial paper notes, the
committee is not required to comply with the requirements of Section
16732.
   (2) The method of setting the interest rates and interest payment
dates applicable to the commercial paper notes, in accordance with
the following:
   (A) Commercial paper notes may bear a stated rate of interest
payable only at maturity, which rate or rates may be determined at
the time of sale of each unit of commercial paper notes.
   (B) The rate of interest borne by the commercial paper notes shall
not exceed 11 percent per annum.
   (C) Notwithstanding any other provision of this chapter, whenever
the committee determines to issue commercial paper notes, the
committee is not required to comply with the requirements of Section
16733.
   (3) Any provisions for the redemption of the commercial paper
notes prior to stated maturity.
   (4) The technical form and language of the commercial paper notes.

   (5) All other terms and conditions of the commercial paper notes
and of their execution, issuance, and sale, deemed necessary and
appropriate by the committee.
   (b) Notwithstanding any other provision of this chapter, when the
committee determines to issue commercial paper notes, all of the
following shall apply:
   (1) The commercial paper notes may be sold at negotiated sale at a
price below the par value in a manner consistent with paragraph (2)
of subdivision (a).
   (2) During the term of any program of commercial paper notes, the
renewal and reissuance from time to time of the commercial paper
notes in an amount up to the maximum amount authorized by the
resolution shall be deemed to be a refunding of the previously
maturing amount, permitted by and consistent with Article 6
(commencing with Section 16780).
   (3) Consistent with the intent for the General Fund to realize a
savings in debt service costs when commercial paper notes are issued
in place of bonds without shifting or adding financing and debt
service costs to the bond funds, the state administrative costs of
commercial paper and interest payable and other costs associated with
commercial paper notes shall be paid for as follows:
   (A) The proceeds of commercial paper notes are, notwithstanding
Section 13340, continuously appropriated to pay the state
administrative costs of commercial paper including, but not limited
to, costs of the Treasurer's office, the Controller's office, and the
Department of Finance.
   (B) The interest payable on maturing commercial paper notes and
other costs associated with commercial paper notes not specified in
subparagraph (A), including, but not limited to, remarketing fees,
issuing and paying agent fees, the letter or line of credit provider
fees, the rating agency fees, and bond counsel fees, shall be paid
from the General Fund which, notwithstanding Section 13340, is
continuously appropriated to pay the interests and costs.
  SEC. 88.  Section 22898 of the Government Code is amended to read:
   22898.  (a) Notwithstanding any other provision of this part, the
percentage of employer contribution payable for postretirement health
benefits for an employee of the Alameda County Transportation
Improvement Authority shall, except as provided in subdivision (b),
be based on the employee's completed years of credited service,
provided that the Alameda County Transportation Improvement Authority
shall not pay an employer contribution for the first five years of
that credited service, and shall pay thereafter as shown in the
following table:

Credited Years of Service  Percentage of Employer
Contribution
5..............................................50
6..............................................55
7..............................................60
8..............................................65
9..............................................70
10.............................................75
11.............................................80
12.............................................85
13.............................................90
14.............................................95
15............................................100


   The application of this subdivision shall be subject to the
following:
   (1) The employer contribution with respect to each annuitant shall
be adjusted by the employer each year. Those adjustments shall be
based upon the principle that the employer contribution for each
annuitant may not be less than the amount equal to 100 percent of the
weighted average of the health benefits plan premiums for an
employee or annuitant enrolled for self-alone, during the benefit
year to which the formula is applied, for the four health benefit
plans that had the largest agency enrollment, excluding family
members, during the previous benefit year. For each annuitant with
enrolled family members, the employer shall not pay an additional
contribution.
   (2) The employer shall certify to the board, in the case of
employees not represented by a bargaining unit, that there is not an
applicable memorandum of understanding.
   (3) The credited service of an annuitant for the purpose of
determining the percentage of employer contributions applicable under
this section shall mean state service as defined in Section 20069,
except that at least five years of credited service shall have been
performed with the Alameda County Transportation Improvement
Authority.
   (4) The employer shall provide the board any information requested
that the board determines is necessary to implement this section.
   (b) Notwithstanding subdivision (a), the contribution payable by
the employer subject to this section shall be equal to 100 percent of
the amount established pursuant to paragraph (1) of subdivision (a)
on behalf of any annuitant who either:
   (1) Retired for disability.
   (2) Retired for service with 15 or more years of service credit
entirely with that employer, regardless of the number of days after
separation from employment. The contribution payable by the employer
under this paragraph shall be paid only if it is greater than, and
made in lieu of, a contribution payable to the annuitant by another
employer under this part. The board shall establish application
procedures and eligibility criteria to implement this paragraph.
   (c) This section applies only to the Alameda County Transportation
Improvement Authority, or its successor, and only with regard to the
employees of the agency who are first hired on or after October 1,
2004.
  SEC. 89.  Section 25331 of the Government Code is amended to read:
   25331.  It is the intent of the Legislature that the fees or
charges authorized by this chapter are for optional services that the
public may or may not choose to purchase, and are not taxes for the
purposes of Article XIII A of the California Constitution.
  SEC. 90.  Section 31855.9 of the Government Code is amended to
read:
   31855.9.  Upon the death of a member prior to retirement who was a
member continuously for not less than 18 months immediately prior to
the member's death who is survived by a spouse with whom the member
was living at the time of his or her death, the retirement system
shall pay to the surviving spouse, in addition to all other payments
due, if any, a lump sum supplemental survivorship benefit of two
hundred fifty-five dollars ($255), as set forth in Section 31855.8 or
31855.12. If the member is not survived by a spouse with whom the
member was living, the retirement system shall apply a lump sum
supplemental survivorship benefit to reimburse the person who paid
the funeral expenses of the member in an amount not to exceed two
hundred fifty-five dollars ($255).
  SEC. 91.  Section 53601 of the Government Code is amended to read:
   53601.  This section shall apply to a local agency that is a city,
a district, or other local agency that does not pool money in
deposits or investments with other local agencies, other than local
agencies that have the same governing body. However, Section 53635
shall apply to all local agencies that pool money in deposits or
investments with other local agencies that have separate governing
bodies. The legislative body of a local agency having moneys in a
sinking fund or moneys in its treasury not required for the immediate
needs of the local agency may invest any portion of the moneys that
it deems wise or expedient in those investments set forth below. A
local agency purchasing or obtaining any securities prescribed in
this section, in a negotiable, bearer, registered, or nonregistered
format, shall require delivery of the securities to the local agency,
including those purchased for the agency by financial advisers,
consultants, or managers using the agency's funds, by book entry,
physical delivery, or by third-party custodial agreement. The
transfer of securities to the counterparty bank's customer book entry
account may be used for book entry delivery.
   For purposes of this section, "counterparty" means the other party
to the transaction. A counterparty bank's trust department or
separate safekeeping department may be used for the physical delivery
of the security if the security is held in the name of the local
agency. Where this section specifies a percentage limitation for a
particular category of investment, that percentage is applicable only
at the date of purchase. Where this section does not specify a
limitation on the term or remaining maturity at the time of the
investment, no investment shall be made in any security, other than a
security underlying a repurchase or reverse repurchase agreement or
securities lending agreement authorized by this section, that at the
time of the investment has a term remaining to maturity in excess of
five years, unless the legislative body has granted express authority
to make that investment either specifically or as a part of an
investment program approved by the legislative body no less than
three months prior to the investment:
   (a) Bonds issued by the local agency, including bonds payable
solely out of the revenues from a revenue-producing property owned,
controlled, or operated by the local agency or by a department,
board, agency, or authority of the local agency.
   (b) United States Treasury notes, bonds, bills, or certificates of
indebtedness, or those for which the faith and credit of the United
States are pledged for the payment of principal and interest.
   (c) Registered state warrants or treasury notes or bonds of this
state, including bonds payable solely out of the revenues from a
revenue-producing property owned, controlled, or operated by the
state or by a department, board, agency, or authority of the state.
   (d) Registered treasury notes or bonds of any of the other 49
United States in addition to California, including bonds payable
solely out of the revenues from a revenue-producing property owned,
controlled, or operated by a state or by a department, board, agency,
or authority of any of the other 49 United States, in addition to
California.
   (e) Bonds, notes, warrants, or other evidences of indebtedness of
a local agency within this state, including bonds payable solely out
of the revenues from a revenue-producing property owned, controlled,
or operated by the local agency, or by a department, board, agency,
or authority of the local agency.
   (f) Federal agency or United States government-sponsored
enterprise obligations, participations, or other instruments,
including those issued by or fully guaranteed as to principal and
interest by federal agencies or United States government-sponsored
enterprises.
   (g) Bankers' acceptances otherwise known as bills of exchange or
time drafts that are drawn on and accepted by a commercial bank.
Purchases of bankers' acceptances shall not exceed 180 days' maturity
or 40 percent of the agency's moneys that may be invested pursuant
to this section. However, no more than 30 percent of the agency's
moneys may be invested in the bankers' acceptances of any one
commercial bank pursuant to this section.
   This subdivision does not preclude a municipal utility district
from investing moneys in its treasury in a manner authorized by the
Municipal Utility District Act (Division 6 (commencing with Section
11501) of the Public Utilities Code).
   (h) Commercial paper of "prime" quality of the highest ranking or
of the highest letter and number rating as provided for by a
nationally recognized statistical rating organization (NRSRO). The
entity that issues the commercial paper shall meet all of the
following conditions in either paragraph (1) or (2):
   (1) The entity meets the following criteria:
   (A) Is organized and operating in the United States as a general
corporation.
   (B) Has total assets in excess of five hundred million dollars
($500,000,000).
   (C) Has debt other than commercial paper, if any, that is rated "A"
or higher by an NRSRO.
   (2) The entity meets the following criteria:
   (A) Is organized within the United States as a special purpose
corporation, trust, or limited liability company.
   (B) Has programwide credit enhancements including, but not limited
to, overcollateralization, letters of credit, or a surety bond.
   (C) Has commercial paper that is rated "A-1" or higher, or the
equivalent, by an NRSRO.
   Eligible commercial paper shall have a maximum maturity of 270
days or less. Local agencies, other than counties or a city and
county, may invest no more than 25 percent of their moneys in
eligible commercial paper. Local agencies, other than counties or a
city and county, may purchase no more than 10 percent of the
outstanding commercial paper of any single issuer. Counties or a city
and county may invest in commercial paper pursuant to the
concentration limits in subdivision (a) of Section 53635.
   (i) Negotiable certificates of deposit issued by a nationally or
state-chartered bank, a savings association or a federal association
(as defined by Section 5102 of the Financial Code), a state or
federal credit union, or by a state-licensed branch of a foreign
bank. Purchases of negotiable certificates of deposit shall not
exceed 30 percent of the agency's moneys that may be invested
pursuant to this section. For purposes of this section, negotiable
certificates of deposit do not come within Article 2 (commencing with
Section 53630), except that the amount so invested shall be subject
to the limitations of Section 53638. The legislative body of a local
agency and the treasurer or other official of the local agency having
legal custody of the moneys are prohibited from investing local
agency funds, or funds in the custody of the local agency, in
negotiable certificates of deposit issued by a state or federal
credit union if a member of the legislative body of the local agency,
or a person with investment decisionmaking authority in the
administrative office manager's office, budget office,
auditor-controller's office, or treasurer's office of the local
agency also serves on the board of directors, or any committee
appointed by the board of directors, or the credit committee or the
supervisory committee of the state or federal credit union issuing
the negotiable certificates of deposit.
   (j) (1) Investments in repurchase agreements or reverse repurchase
agreements or securities lending agreements of securities authorized
by this section, as long as the agreements are subject to this
subdivision, including the delivery requirements specified in this
section.
   (2) Investments in repurchase agreements may be made, on an
investment authorized in this section, when the term of the agreement
does not exceed one year. The market value of securities that
underlie a repurchase agreement shall be valued at 102 percent or
greater of the funds borrowed against those securities and the value
shall be adjusted no less than quarterly. Since the market value of
the underlying securities is subject to daily market fluctuations,
the investments in repurchase agreements shall be in compliance if
the value of the underlying securities is brought back up to 102
percent no later than the next business day.
   (3) Reverse repurchase agreements or securities lending agreements
may be utilized only when all of the following conditions are met:
   (A) The security to be sold using a reverse repurchase agreement
or securities lending agreement has been owned and fully paid for by
the local agency for a minimum of 30 days prior to sale.
   (B) The total of all reverse repurchase agreements and securities
lending agreements on investments owned by the local agency does not
exceed 20 percent of the base value of the portfolio.
   (C) The agreement does not exceed a term of 92 days, unless the
agreement includes a written codicil guaranteeing a minimum earning
or spread for the entire period between the sale of a security using
a reverse repurchase agreement or securities lending agreement and
the final maturity date of the same security.
   (D) Funds obtained or funds within the pool of an equivalent
amount to that obtained from selling a security to a counterparty
using a reverse repurchase agreement or securities lending agreement
shall not be used to purchase another security with a maturity longer
than 92 days from the initial settlement date of the reverse
repurchase agreement or securities lending agreement, unless the
reverse repurchase agreement or securities lending agreement includes
a written codicil guaranteeing a minimum earning or spread for the
entire period between the sale of a security using a reverse
repurchase agreement or securities lending agreement and the final
maturity date of the same security.
   (4) (A) Investments in reverse repurchase agreements, securities
lending agreements, or similar investments in which the local agency
sells securities prior to purchase with a simultaneous agreement to
repurchase the security may be made only upon prior approval of the
governing body of the local agency and shall be made only with
primary dealers of the Federal Reserve Bank of New York or with a
nationally or state-chartered bank that has or has had a significant
banking relationship with a local agency.
   (B) For purposes of this chapter, "significant banking
relationship" means any of the following activities of a bank:
   (i) Involvement in the creation, sale, purchase, or retirement of
a local agency's bonds, warrants, notes, or other evidence of
indebtedness.
   (ii) Financing of a local agency's activities.
   (iii) Acceptance of a local agency's securities or funds as
deposits.
   (5) (A) "Repurchase agreement" means a purchase of securities by
the local agency pursuant to an agreement by which the counterparty
seller will repurchase the securities on or before a specified date
and for a specified amount and the counterparty will deliver the
underlying securities to the local agency by book entry, physical
delivery, or by third-party custodial agreement. The transfer of
underlying securities to the counterparty bank's customer book-entry
account may be used for book-entry delivery.
   (B) "Securities," for purposes of repurchase under this
subdivision, means securities of the same issuer, description, issue
date, and maturity.
   (C) "Reverse repurchase agreement" means a sale of securities by
the local agency pursuant to an agreement by which the local agency
will repurchase the securities on or before a specified date and
includes other comparable agreements.
   (D) "Securities lending agreement" means an agreement under which
a local agency agrees to transfer securities to a borrower who, in
turn, agrees to provide collateral to the local agency. During the
term of the agreement, both the securities and the collateral are
held by a third party. At the conclusion of the agreement, the
securities are transferred back to the local agency in return for the
collateral.
   (E) For purposes of this section, the base value of the local
agency's pool portfolio shall be that dollar amount obtained by
totaling all cash balances placed in the pool by all pool
participants, excluding any amounts obtained through selling
securities by way of reverse repurchase agreements, securities
lending agreements, or other similar borrowing methods.
   (F) For purposes of this section, the spread is the difference
between the cost of funds obtained using the reverse repurchase
agreement and the earnings obtained on the reinvestment of the funds.

                                                              (k)
Medium-term notes, defined as all corporate and depository
institution debt securities with a maximum remaining maturity of five
years or less, issued by corporations organized and operating within
the United States or by depository institutions licensed by the
United States or any state and operating within the United States.
Notes eligible for investment under this subdivision shall be rated
"A" or better by an NRSRO. Purchases of medium-term notes shall not
include other instruments authorized by this section and may not
exceed 30 percent of the agency's moneys that may be invested
pursuant to this section.
   (l) (1) Shares of beneficial interest issued by diversified
management companies that invest in the securities and obligations as
authorized by subdivisions (a) to (k), inclusive, and subdivisions
(m) to (o), inclusive, and that comply with the investment
restrictions of this article and Article 2 (commencing with Section
53630). However, notwithstanding these restrictions, a counterparty
to a reverse repurchase agreement or securities lending agreement is
not required to be a primary dealer of the Federal Reserve Bank of
New York if the company's board of directors finds that the
counterparty presents a minimal risk of default, and the value of the
securities underlying a repurchase agreement or securities lending
agreement may be 100 percent of the sales price if the securities are
marked to market daily.
   (2) Shares of beneficial interest issued by diversified management
companies that are money market funds registered with the Securities
and Exchange Commission under the Investment Company Act of 1940 (15
U.S.C. Sec. 80a-1 et seq.).
   (3) If investment is in shares issued pursuant to paragraph (1),
the company shall have met either of the following criteria:
   (A) Attained the highest ranking or the highest letter and
numerical rating provided by not less than two NRSROs.
   (B) Retained an investment adviser registered or exempt from
registration with the Securities and Exchange Commission with not
less than five years' experience investing in the securities and
obligations authorized by subdivisions (a) to (k), inclusive, and
subdivisions (m) to (o), inclusive, and with assets under management
in excess of five hundred million dollars ($500,000,000).
   (4) If investment is in shares issued pursuant to paragraph (2),
the company shall have met either of the following criteria:
   (A) Attained the highest ranking or the highest letter and
numerical rating provided by not less than two NRSROs.
   (B) Retained an investment adviser registered or exempt from
registration with the Securities and Exchange Commission with not
less than five years' experience managing money market mutual funds
with assets under management in excess of five hundred million
dollars ($500,000,000).
   (5) The purchase price of shares of beneficial interest purchased
pursuant to this subdivision shall not include commission that the
companies may charge and shall not exceed 20 percent of the agency's
moneys that may be invested pursuant to this section. However, no
more than 10 percent of the agency's funds may be invested in shares
of beneficial interest of any one mutual fund pursuant to paragraph
(1).
   (m) Moneys held by a trustee or fiscal agent and pledged to the
payment or security of bonds or other indebtedness, or obligations
under a lease, installment sale, or other agreement of a local
agency, or certificates of participation in those bonds,
indebtedness, or lease installment sale, or other agreements, may be
invested in accordance with the statutory provisions governing the
issuance of those bonds, indebtedness, or lease installment sale, or
other agreement, or to the extent not inconsistent therewith or if
there are no specific statutory provisions, in accordance with the
ordinance, resolution, indenture, or agreement of the local agency
providing for the issuance.
   (n) Notes, bonds, or other obligations that are at all times
secured by a valid first priority security interest in securities of
the types listed by Section 53651 as eligible securities for the
purpose of securing local agency deposits having a market value at
least equal to that required by Section 53652 for the purpose of
securing local agency deposits. The securities serving as collateral
shall be placed by delivery or book entry into the custody of a trust
company or the trust department of a bank that is not affiliated
with the issuer of the secured obligation, and the security interest
shall be perfected in accordance with the requirements of the Uniform
Commercial Code or federal regulations applicable to the types of
securities in which the security interest is granted.
   (o) A mortgage passthrough security, collateralized mortgage
obligation, mortgage-backed or other pay-through bond, equipment
lease-backed certificate, consumer receivable passthrough
certificate, or consumer receivable-backed bond of a maximum of five
years' maturity. Securities eligible for investment under this
subdivision shall be issued by an issuer having an "A" or higher
rating for the issuer's debt as provided by an NRSRO and rated in a
rating category of "AA" or its equivalent or better by an NRSRO.
Purchase of securities authorized by this subdivision may not exceed
20 percent of the agency's surplus moneys that may be invested
pursuant to this section.
   (p) Shares of beneficial interest issued by a joint powers
authority organized pursuant to Section 6509.7 that invests in the
securities and obligations authorized in subdivisions (a) to (o),
inclusive. Each share shall represent an equal proportional interest
in the underlying pool of securities owned by the joint powers
authority. To be eligible under this section, the joint powers
authority issuing the shares shall have retained an investment
adviser that meets all of the following criteria:
   (1) The adviser is registered or exempt from registration with the
Securities and Exchange Commission.
   (2) The adviser has not less than five years of experience
investing in the securities and obligations authorized in
subdivisions (a) to (o), inclusive.
   (3) The adviser has assets under management in excess of five
hundred million dollars ($500,000,000).
  SEC. 92.  Section 56375.2 of the Government Code is amended to
read:
   56375.2.  (a) In addition to those powers enumerated in Section
56375, the Marin Local Agency Formation Commission may initiate and
approve, after notice and hearing, a reorganization or consolidation
of the Sewerage Agency of Southern Marin and its member districts,
without protest hearings.
   (b) If the commission initiates and approves the reorganization or
consolidation pursuant to subdivision (a), the commission may impose
terms and conditions on the reorganization or consolidation that
would require the Sewerage Agency of Southern Marin and its member
agencies to be responsible for payment of the commission's costs
incurred in association with the reorganization or consolidation.
   (c) This section shall become effective on January 1, 2011.
  SEC. 93.  Section 56668 of the Government Code is amended to read:
   56668.  Factors to be considered in the review of a proposal shall
include, but not be limited to, all of the following:
   (a) Population and population density; land area and land use; per
capita assessed valuation; topography, natural boundaries, and
drainage basins; proximity to other populated areas; the likelihood
of significant growth in the area, and in adjacent incorporated and
unincorporated areas, during the next 10 years.
   (b) The need for organized community services; the present cost
and adequacy of governmental services and controls in the area;
probable future needs for those services and controls; probable
effect of the proposed incorporation, formation, annexation, or
exclusion and of alternative courses of action on the cost and
adequacy of services and controls in the area and adjacent areas.
   "Services," as used in this subdivision, refers to governmental
services whether or not the services are services which would be
provided by local agencies subject to this division, and includes the
public facilities necessary to provide those services.
   (c) The effect of the proposed action and of alternative actions,
on adjacent areas, on mutual social and economic interests, and on
the local governmental structure of the county.
   (d) The conformity of both the proposal and its anticipated
effects with both the adopted commission policies on providing
planned, orderly, efficient patterns of urban development, and the
policies and priorities in Section 56377.
   (e) The effect of the proposal on maintaining the physical and
economic integrity of agricultural lands, as defined by Section
56016.
   (f) The definiteness and certainty of the boundaries of the
territory, the nonconformance of proposed boundaries with lines of
assessment or ownership, the creation of islands or corridors of
unincorporated territory, and other similar matters affecting the
proposed boundaries.
   (g) A regional transportation plan adopted pursuant to Section
65080, and its consistency with city or county general and specific
plans.
   (h) The sphere of influence of any local agency which may be
applicable to the proposal being reviewed.
   (i) The comments of any affected local agency or other public
agency.
   (j) The ability of the newly formed or receiving entity to provide
the services which are the subject of the application to the area,
including the sufficiency of revenues for those services following
the proposed boundary change.
   (k) Timely availability of water supplies adequate for projected
needs as specified in Section 65352.5.
   (  l  ) The extent to which the proposal will affect a
city or cities and the county in achieving their respective fair
shares of the regional housing needs as determined by the appropriate
council of governments consistent with Article 10.6 (commencing with
Section 65580) of Chapter 3 of Division 1 of Title 7.
   (m) Any information or comments from the landowner or owners,
voters, or residents of the affected territory.
   (n) Any information relating to existing land use designations.
   (o) The extent to which the proposal will promote environmental
justice. As used in this subdivision, "environmental justice" means
the fair treatment of people of all races, cultures, and incomes with
respect to the location of public facilities and the provision of
public services.
  SEC. 94.  Section 63049.62 of the Government Code is amended to
read:
   63049.62.  Notwithstanding any other provision of this division, a
financing of the costs of claims of insolvent insurers upon the
request of the association pursuant to Section 1063.73 of the
Insurance Code shall be deemed to be in the public interest and
eligible for financing by the bank, and Article 3 (commencing with
Section 63040), Article 4 (commencing with Section 63042), Article 5
(commencing with Section 63043), Article 6 (commencing with Section
63048), and Article 7 (commencing with Section 63049) shall not apply
to the financing provided by the bank to, or at the request of, the
association or the department in connection with the fund.
Notwithstanding any other provision of this division, the bank shall
have no authority over any matter that is subject to the approval of
the Insurance Commissioner under Article 14.2 (commencing with
Section 1063) of Chapter 1 of Part 2 of Division 1 of the Insurance
Code.
  SEC. 94.5.  Section 63049.67 of the Government Code is amended to
read:
   63049.67.  (a) Notwithstanding any other provision of this
division, a financing of emergency apportionments upon the request of
a school district pursuant to Article 2.7 (commencing with Section
41329.50) of Chapter 3 of Part 24 of Division 3 of Title 2 of the
Education Code, is deemed to be in the public interest and eligible
for financing by the bank. Article 3 (commencing with Section 63040),
Article 4 (commencing with Section 63042) and Article 5 (commencing
with Section 63043) do not apply to the financing provided by the
bank in connection with an emergency apportionment.
   (b) The bank may issue bonds pursuant to Chapter 5 (commencing
with Section 63070) and provide the proceeds to a school district
pursuant to a lease agreement. The proceeds may be used as an
emergency apportionment, to reimburse the interim emergency
apportionment from the General Fund authorized pursuant to
subdivision (b) of Section 41329.52 of the Education Code, or to
refund bonds previously issued under this section. Bond proceeds may
also be used to fund necessary reserves, capitalized interest, credit
enhancement costs, and costs of issuance.
   (c) Bonds issued under this article are not deemed to constitute a
debt or liability of the state or of any political subdivision of
the state, other than a limited obligation of the bank, or a pledge
of the faith and credit of the state or of any political subdivision.
All bonds issued under this article shall contain on the face of the
bonds a statement to the same effect.
   (d) Any fund or account established in connection with the bonds
shall be established outside of the centralized treasury system.
Notwithstanding any other law, the bank shall select the financing
team and the trustee for the bonds, and the trustee shall be a
corporation or banking association authorized to exercise corporate
trust powers.
   (e) Pursuant to Section 41329.55 of the Education Code, a school
district other than the Compton Community College District shall
instruct the Controller to repay the lease from moneys in the State
School Fund designated for apportionment to the school district.
Pursuant to Section 41329.55, if the school district is the Compton
Community College District, the Controller shall be instructed to
repay the lease from moneys in Section B of the State School Fund.
Any amounts necessary to make this repayment shall be drawn from the
total statewide funding available for community college apportionment
consisting of funds in Section B of the State School Fund.
Thereafter the Controller shall transfer to Section B of the State
School Fund, either in a single or multiple transfers, an amount
equal to the total repayment, which amount shall be transferred from
the amount designated for apportionment to the Compton Community
College District from the State School Fund. If these transfers from
the district prove inadequate to repay any repayments for any reason,
the Compton Community College District is required to use any
revenue sources available to it for transfer and repayment purposes.
   (f) Notwithstanding any other law, as long as any bonds issued
pursuant to this section are outstanding, the following requirements
apply:
   (1) The school district for which the bonds were issued is not
eligible to be a debtor in a case under Chapter 9 of the United
States Bankruptcy Code, as it may be amended from time to time, and
no governmental officer or organization is or may be empowered to
authorize the school district to be a debtor under that chapter.
   (2) It is the intent of the Legislature that the Legislature
should not in the future abolish the Compton Community College
District or take any action that would prevent the Compton Community
College from entering into or performing binding agreements or
invalidate any prior binding agreements of the Compton Community
College District, where invalidation may have a material adverse
effect on the bonds issued pursuant to this section.
   (3) The Compton Community College District shall not be
reorganized or merged with another community college district unless
all of the following apply:
   (A) The successor district becomes by operation of law the owner
of all property previously owned by the Compton Community College
District.
   (B) Any agreement entered into by the Compton Community College
District in connection with bonds issued pursuant to this section are
assumed by the successor district.
   (C) The apportionment authorized by subdivision (e) remains in
effect.
   (D) Receipt by the bank of an opinion of bond counsel that the
bonds issued for the Compton Community College District will remain
tax exempt following the reorganization or merger.
   (g) Nothing in this section limits the authority of the
Legislature to abolish the Compton Community College District when
bonds issued for that district are no longer outstanding. Further,
the Legislature may provide for the redemption or defeasance of the
bonds at any time so that no bonds are outstanding. If the
Legislature provides for the redemption or defeasance of the bonds
issued for the Compton Community College District in order to abolish
that district, it is the intent of the Legislature that the funds
required for the redemption or defeasance should be appropriated from
Section B of the State School Fund.
   (h) The bank may enter into contracts or agreements with banks,
insurers, or other financial institutions or parties that it
determines are necessary or desirable to improve the security and
marketability of, or to manage interest rates or other risks
associated with, the bonds issued pursuant to this section. The bank
may pledge apportionments made by the Controller directly to the bond
trustee pursuant to Section 41329.55 of the Education Code as
security for repayment of any obligation owed to a bank, insurer, or
other financial institution pursuant to this subdivision.
  SEC. 95.  Section 65080 of the Government Code is amended to read:
   65080.  (a) Each transportation planning agency designated under
Section 29532 or 29532.1 shall prepare and adopt a regional
transportation plan directed at achieving a coordinated and balanced
regional transportation system, including, but not limited to, mass
transportation, highway, railroad, maritime, bicycle, pedestrian,
goods movement, and aviation facilities and services. The plan shall
be action-oriented and pragmatic, considering both the short-term and
long-term future, and shall present clear, concise policy guidance
to local and state officials. The regional transportation plan shall
consider factors specified in Section 134 of Title 23 of the United
States Code. Each transportation planning agency shall consider and
incorporate, as appropriate, the transportation plans of cities,
counties, districts, private organizations, and state and federal
agencies.
   (b) The regional transportation plan shall be an internally
consistent document and shall include all of the following:
   (1) A policy element that describes the transportation issues in
the region, identifies and quantifies regional needs, and describes
the desired short-range and long-range transportation goals, and
pragmatic objective and policy statements. The objective and policy
statements shall be consistent with the funding estimates of the
financial element. The policy element of transportation planning
agencies with populations that exceed 200,000 persons may quantify a
set of indicators including, but not limited to, all of the
following:
   (A) Measures of mobility and traffic congestion, including, but
not limited to, daily vehicle hours of delay per capita and vehicle
miles traveled per capita.
   (B) Measures of road and bridge maintenance and rehabilitation
needs, including, but not limited to, roadway pavement and bridge
conditions.
   (C) Measures of means of travel, including, but not limited to,
percentage share of all trips (work and nonwork) made by all of the
following:
   (i) Single occupant vehicle.
   (ii) Multiple occupant vehicle or carpool.
   (iii) Public transit including commuter rail and intercity rail.
   (iv) Walking.
   (v) Bicycling.
   (D) Measures of safety and security, including, but not limited
to, total injuries and fatalities assigned to each of the modes set
forth in subparagraph (C).
   (E) Measures of equity and accessibility, including, but not
limited to, percentage of the population served by frequent and
reliable public transit, with a breakdown by income bracket, and
percentage of all jobs accessible by frequent and reliable public
transit service, with a breakdown by income bracket.
   (F) The requirements of this section may be met utilizing existing
sources of information. No additional traffic counts, household
surveys, or other sources of data shall be required.
   (2) A sustainable communities strategy prepared by each
metropolitan planning organization as follows:
   (A) No later than September 30, 2010, the State Air Resources
Board shall provide each affected region with greenhouse gas emission
reduction targets for the automobile and light truck sector for 2020
and 2035, respectively.
   (i) No later than January 31, 2009, the state board shall appoint
a Regional Targets Advisory Committee to recommend factors to be
considered and methodologies to be used for setting greenhouse gas
emission reduction targets for the affected regions. The committee
shall be composed of representatives of the metropolitan planning
organizations, affected air districts, the League of California
Cities, the California State Association of Counties, local
transportation agencies, and members of the public, including
homebuilders, environmental organizations, planning organizations,
environmental justice organizations, affordable housing
organizations, and others. The advisory committee shall transmit a
report with its recommendations to the state board no later than
September 30, 2009. In recommending factors to be considered and
methodologies to be used, the advisory committee may consider any
relevant issues, including, but not limited to, data needs, modeling
techniques, growth forecasts, the impacts of regional jobs-housing
balance on interregional travel and greenhouse gas emissions,
economic and demographic trends, the magnitude of greenhouse gas
reduction benefits from a variety of land use and transportation
strategies, and appropriate methods to describe regional targets and
to monitor performance in attaining those targets. The state board
shall consider the report prior to setting the targets.
   (ii) Prior to setting the targets for a region, the state board
shall exchange technical information with the metropolitan planning
organization and the affected air district. The metropolitan planning
organization may recommend a target for the region. The metropolitan
planning organization shall hold at least one public workshop within
the region after receipt of the report from the advisory committee.
The state board shall release draft targets for each region no later
than June 30, 2010.
   (iii) In establishing these targets, the state board shall take
into account greenhouse gas emission reductions that will be achieved
by improved vehicle emission standards, changes in fuel composition,
and other measures it has approved that will reduce greenhouse gas
emissions in the affected regions, and prospective measures the state
board plans to adopt to reduce greenhouse gas emissions from other
greenhouse gas emission sources as that term is defined in
subdivision (i) of Section 38505 of the Health and Safety Code and
consistent with the regulations promulgated pursuant to the
California Global Warming Solutions Act of 2006 (Division 25.5
(commencing with Section 38500) of the Health and Safety Code).
   (iv) The state board shall update the regional greenhouse gas
emission reduction targets every eight years consistent with each
metropolitan planning organization's timeframe for updating its
regional transportation plan under federal law until 2050. The state
board may revise the targets every four years based on changes in the
factors considered under clause (iii). The state board shall
exchange technical information with the Department of Transportation,
metropolitan planning organizations, local governments, and affected
air districts and engage in a consultative process with public and
private stakeholders prior to updating these targets.
   (v) The greenhouse gas emission reduction targets may be expressed
in gross tons, tons per capita, tons per household, or in any other
metric deemed appropriate by the state board.
   (B) Each metropolitan planning organization shall prepare a
sustainable communities strategy, subject to the requirements of Part
450 of Title 23 of, and Part 93 of Title 40 of, the Code of Federal
Regulations, including the requirement to utilize the most recent
planning assumptions considering local general plans and other
factors. The sustainable communities strategy shall (i) identify the
general location of uses, residential densities, and building
intensities within the region, (ii) identify areas within the region
sufficient to house all the population of the region, including all
economic segments of the population, over the course of the planning
period of the regional transportation plan taking into account net
migration into the region, population growth, household formation and
employment growth, (iii) identify areas within the region sufficient
to house an eight-year projection of the regional housing need for
the region pursuant to Section 65584, (iv) identify a transportation
network to service the transportation needs of the region, (v) gather
and consider the best practically available scientific information
regarding resource areas and farmland in the region as defined in
subdivisions (a) and (b) of Section 65080.01, (vi) consider the state
housing goals specified in Sections 65580 and 65581, (vii) set forth
a forecasted development pattern for the region, which, when
integrated with the transportation network, and other transportation
measures and policies, will reduce the greenhouse gas emissions from
automobiles and light trucks to achieve, if there is a feasible way
to do so, the greenhouse gas emission reduction targets approved by
the state board, and (viii) allow the regional transportation plan to
comply with Section 176 of the federal Clean Air Act (42 U.S.C. Sec.
7506).
   (C) (i) Within the jurisdiction of the Metropolitan Transportation
Commission, as defined by Section 66502, the Association of Bay Area
Governments shall be responsible for clauses (i), (ii), (iii), (v),
and (vi) of subparagraph (B), the Metropolitan Transportation
Commission shall be responsible for clauses (iv) and (viii) of
subparagraph (B); and the Association of Bay Area Governments and the
Metropolitan Transportation Commission shall jointly be responsible
for clause (vii) of subparagraph (B).
   (ii) Within the jurisdiction of the Tahoe Regional Planning
Agency, as defined in Sections 66800 and 66801, the Tahoe
Metropolitan Planning Organization shall use the Regional Plan for
the Lake Tahoe Region as the sustainable community strategy, provided
that it                                                  complies
with clauses (vii) and (viii) of subparagraph (B).
   (D) In the region served by the multicounty transportation
planning agency described in Section 130004 of the Public Utilities
Code, a subregional council of governments and the county
transportation commission may work together to propose the
sustainable communities strategy and an alternative planning
strategy, if one is prepared pursuant to subparagraph (I), for that
subregional area. The metropolitan planning organization may adopt a
framework for a subregional sustainable communities strategy or a
subregional alternative planning strategy to address the
intraregional land use, transportation, economic, air quality, and
climate policy relationships. The metropolitan planning organization
shall include the subregional sustainable communities strategy for
that subregion in the regional sustainable communities strategy to
the extent consistent with this section and federal law and approve
the subregional alternative planning strategy, if one is prepared
pursuant to subparagraph (I), for that subregional area to the extent
consistent with this section. The metropolitan planning organization
shall develop overall guidelines, create public participation plans
pursuant to subparagraph (F), ensure coordination, resolve conflicts,
make sure that the overall plan complies with applicable legal
requirements, and adopt the plan for the region.
   (E) The metropolitan planning organization shall conduct at least
two informational meetings in each county within the region for
members of the board of supervisors and city councils on the
sustainable communities strategy and alternative planning strategy,
if any. The metropolitan planning organization may conduct only one
informational meeting if it is attended by representatives of the
county board of supervisors and city council members representing a
majority of the cities representing a majority of the population in
the incorporated areas of that county. Notice of the meeting or
meetings shall be sent to the clerk of the board of supervisors and
to each city clerk. The purpose of the meeting or meetings shall be
to discuss the sustainable communities strategy and the alternative
planning strategy, if any, including the key land use and planning
assumptions to the members of the board of supervisors and the city
council members in that county and to solicit and consider their
input and recommendations.
   (F) Each metropolitan planning organization shall adopt a public
participation plan, for development of the sustainable communities
strategy and an alternative planning strategy, if any, that includes
all of the following:
   (i) Outreach efforts to encourage the active participation of a
broad range of stakeholder groups in the planning process, consistent
with the agency's adopted Federal Public Participation Plan,
including, but not limited to, affordable housing advocates,
transportation advocates, neighborhood and community groups,
environmental advocates, home builder representatives, broad-based
business organizations, landowners, commercial property interests,
and homeowner associations.
   (ii) Consultation with congestion management agencies,
transportation agencies, and transportation commissions.
   (iii) Workshops throughout the region to provide the public with
the information and tools necessary to provide a clear understanding
of the issues and policy choices. At least one workshop shall be held
in each county in the region. For counties with a population greater
than 500,000, at least three workshops shall be held. Each workshop,
to the extent practicable, shall include urban simulation computer
modeling to create visual representations of the sustainable
communities strategy and the alternative planning strategy.
   (iv) Preparation and circulation of a draft sustainable
communities strategy and an alternative planning strategy, if one is
prepared, not less than 55 days before adoption of a final regional
transportation plan.
   (v) At least three public hearings on the draft sustainable
communities strategy in the regional transportation plan and
alternative planning strategy, if one is prepared. If the
metropolitan transportation organization consists of a single county,
at least two public hearings shall be held. To the maximum extent
feasible, the hearings shall be in different parts of the region to
maximize the opportunity for participation by members of the public
throughout the region.
   (vi) A process for enabling members of the public to provide a
single request to receive notices, information, and updates.
   (G) In preparing a sustainable communities strategy, the
metropolitan planning organization shall consider spheres of
influence that have been adopted by the local agency formation
commissions within its region.
   (H) Prior to adopting a sustainable communities strategy, the
metropolitan planning organization shall quantify the reduction in
greenhouse gas emissions projected to be achieved by the sustainable
communities strategy and set forth the difference, if any, between
the amount of that reduction and the target for the region
established by the state board.
   (I) If the sustainable communities strategy, prepared in
compliance with subparagraph (B) or (D), is unable to reduce
greenhouse gas emissions to achieve the greenhouse gas emission
reduction targets established by the state board, the metropolitan
planning organization shall prepare an alternative planning strategy
to the sustainable communities strategy showing how those greenhouse
gas emission targets would be achieved through alternative
development patterns, infrastructure, or additional transportation
measures or policies. The alternative planning strategy shall be a
separate document from the regional transportation plan, but it may
be adopted concurrently with the regional transportation plan. In
preparing the alternative planning strategy, the metropolitan
planning organization:
   (i) Shall identify the principal impediments to achieving the
targets within the sustainable communities strategy.
   (ii) May include an alternative development pattern for the region
pursuant to subparagraphs (B) to (G), inclusive.
   (iii) Shall describe how the greenhouse gas emission reduction
targets would be achieved by the alternative planning strategy, and
why the development pattern, measures, and policies in the
alternative planning strategy are the most practicable choices for
achievement of the greenhouse gas emission reduction targets.
   (iv) An alternative development pattern set forth in the
alternative planning strategy shall comply with Part 450 of Title 23
of, and Part 93 of Title 40 of, the Code of Federal Regulations,
except to the extent that compliance will prevent achievement of the
greenhouse gas emission reduction targets approved by the state
board.
   (v) For purposes of the California Environmental Quality Act
(Division 13 (commencing with Section 21000) of the Public Resources
Code), an alternative planning strategy shall not constitute a land
use plan, policy, or regulation, and the inconsistency of a project
with an alternative planning strategy shall not be a consideration in
determining whether a project may have an environmental effect.
   (J) (i) Prior to starting the public participation process adopted
pursuant to subparagraph (F), the metropolitan planning organization
shall submit a description to the state board of the technical
methodology it intends to use to estimate the greenhouse gas
emissions from its sustainable communities strategy and, if
appropriate, its alternative planning strategy. The state board shall
respond to the metropolitan planning organization in a timely manner
with written comments about the technical methodology, including
specifically describing any aspects of that methodology it concludes
will not yield accurate estimates of greenhouse gas emissions, and
suggested remedies. The metropolitan planning organization is
encouraged to work with the state board until the state board
concludes that the technical methodology operates accurately.
   (ii) After adoption, a metropolitan planning organization shall
submit a sustainable communities strategy or an alternative planning
strategy, if one has been adopted, to the state board for review,
including the quantification of the greenhouse gas emission
reductions the strategy would achieve and a description of the
technical methodology used to obtain that result. Review by the state
board shall be limited to acceptance or rejection of the
metropolitan planning organization's determination that the strategy
submitted would, if implemented, achieve the greenhouse gas emission
reduction targets established by the state board. The state board
shall complete its review within 60 days.
   (iii) If the state board determines that the strategy submitted
would not, if implemented, achieve the greenhouse gas emission
reduction targets, the metropolitan planning organization shall
revise its strategy or adopt an alternative planning strategy, if not
previously adopted, and submit the strategy for review pursuant to
clause (ii). At a minimum, the metropolitan planning organization
must obtain state board acceptance that an alternative planning
strategy would, if implemented, achieve the greenhouse gas emission
reduction targets established for that region by the state board.
   (K) Neither a sustainable communities strategy nor an alternative
planning strategy regulates the use of land, nor, except as provided
by subparagraph (J), shall either one be subject to any state
approval. Nothing in a sustainable communities strategy shall be
interpreted as superseding the exercise of the land use authority of
cities and counties within the region. Nothing in this section shall
be interpreted to limit the state board's authority under any other
provision of law. Nothing in this section shall be interpreted to
authorize the abrogation of any vested right whether created by
statute or by common law. Nothing in this section shall require a
city's or county's land use policies and regulations, including its
general plan, to be consistent with the regional transportation plan
or an alternative planning strategy. Nothing in this section requires
a metropolitan planning organization to approve a sustainable
communities strategy that would be inconsistent with Part 450 of
Title 23 of, or Part 93 of Title 40 of, the Code of Federal
Regulations and any administrative guidance under those regulations.
Nothing in this section relieves a public or private entity or any
person from compliance with any other local, state, or federal law.
   (L) Nothing in this section requires projects programmed for
funding on or before December 31, 2011, to be subject to the
provisions of this paragraph if they (i) are contained in the 2007 or
2009 Federal Statewide Transportation Improvement Program, (ii) are
funded pursuant to Chapter 12.49 (commencing with Section 8879.20) of
Division 1 of Title 2, or (iii) were specifically listed in a ballot
measure prior to December 31, 2008, approving a sales tax increase
for transportation projects. Nothing in this section shall require a
transportation sales tax authority to change the funding allocations
approved by the voters for categories of transportation projects in a
sales tax measure adopted prior to December 31, 2010. For purposes
of this subparagraph, a transportation sales tax authority is a
district, as defined in Section 7252 of the Revenue and Taxation
Code, that is authorized to impose a sales tax for transportation
purposes.
   (M) A metropolitan planning organization, or a regional
transportation planning agency not within a metropolitan planning
organization, that is required to adopt a regional transportation
plan not less than every five years, may elect to adopt the plan not
less than every four years. This election shall be made by the board
of directors of the metropolitan planning organization or regional
transportation planning agency no later than June 1, 2009, or
thereafter 54 months prior to the statutory deadline for the adoption
of housing elements for the local jurisdictions within the region,
after a public hearing at which comments are accepted from members of
the public and representatives of cities and counties within the
region covered by the metropolitan planning organization or regional
transportation planning agency. Notice of the public hearing shall be
given to the general public and by mail to cities and counties
within the region no later than 30 days prior to the date of the
public hearing. Notice of election shall be promptly given to the
Department of Housing and Community Development. The metropolitan
planning organization or the regional transportation planning agency
shall complete its next regional transportation plan within three
years of the notice of election.
   (N) Two or more of the metropolitan planning organizations for
Fresno County, Kern County, Kings County, Madera County, Merced
County, San Joaquin County, Stanislaus County, and Tulare County may
work together to develop and adopt multiregional goals and policies
that may address interregional land use, transportation, economic,
air quality, and climate relationships. The participating
metropolitan planning organizations may also develop a multiregional
sustainable communities strategy, to the extent consistent with
federal law, or an alternative planning strategy for adoption by the
metropolitan planning organizations. Each participating metropolitan
planning organization shall consider any adopted multiregional goals
and policies in the development of a sustainable communities strategy
and, if applicable, an alternative planning strategy for its region.

   (3) An action element that describes the programs and actions
necessary to implement the plan and assigns implementation
responsibilities. The action element may describe all transportation
projects proposed for development during the 20-year or greater life
of the plan. The action element shall consider congestion management
programming activities carried out within the region.
   (4) (A) A financial element that summarizes the cost of plan
implementation constrained by a realistic projection of available
revenues. The financial element shall also contain recommendations
for allocation of funds. A county transportation commission created
pursuant to Section 130000 of the Public Utilities Code shall be
responsible for recommending projects to be funded with regional
improvement funds, if the project is consistent with the regional
transportation plan. The first five years of the financial element
shall be based on the five-year estimate of funds developed pursuant
to Section 14524. The financial element may recommend the development
of specified new sources of revenue, consistent with the policy
element and action element.
   (B) The financial element of transportation planning agencies with
populations that exceed 200,000 persons may include a project cost
breakdown for all projects proposed for development during the
20-year life of the plan that includes total expenditures and related
percentages of total expenditures for all of the following:
   (i) State highway expansion.
   (ii) State highway rehabilitation, maintenance, and operations.
   (iii) Local road and street expansion.
   (iv) Local road and street rehabilitation, maintenance, and
operation.
   (v) Mass transit, commuter rail, and intercity rail expansion.
   (vi) Mass transit, commuter rail, and intercity rail
rehabilitation, maintenance, and operations.
   (vii) Pedestrian and bicycle facilities.
   (viii) Environmental enhancements and mitigation.
   (ix) Research and planning.
   (x) Other categories.
   (C) The metropolitan planning organization or county
transportation agency, whichever entity is appropriate, shall
consider financial incentives for cities and counties that have
resource areas or farmland, as defined in Section 65080.01, for the
purposes of, for example, transportation investments for the
preservation and safety of the city street or county road system and
farm-to-market and interconnectivity transportation needs. The
metropolitan planning organization or county transportation agency,
whichever entity is appropriate, shall also consider financial
assistance for counties to address countywide service
responsibilities in counties that contribute toward the greenhouse
gas emission reduction targets by implementing policies for growth to
occur within their cities.
   (c) Each transportation planning agency may also include other
factors of local significance as an element of the regional
transportation plan, including, but not limited to, issues of
mobility for specific sectors of the community, including, but not
limited to, senior citizens.
   (d) Except as otherwise provided in this subdivision, each
transportation planning agency shall adopt and submit, every four
years, an updated regional transportation plan to the California
Transportation Commission and the Department of Transportation. A
transportation planning agency located in a federally designated air
quality attainment area or that does not contain an urbanized area
may at its option adopt and submit a regional transportation plan
every five years. When applicable, the plan shall be consistent with
federal planning and programming requirements and shall conform to
the regional transportation plan guidelines adopted by the California
Transportation Commission. Prior to adoption of the regional
transportation plan, a public hearing shall be held after the giving
of notice of the hearing by publication in the affected county or
counties pursuant to Section 6061.
  SEC. 96.  Section 65583 of the Government Code is amended to read:
   65583.  The housing element shall consist of an identification and
analysis of existing and projected housing needs and a statement of
goals, policies, quantified objectives, financial resources, and
scheduled programs for the preservation, improvement, and development
of housing. The housing element shall identify adequate sites for
housing, including rental housing, factory-built housing,
mobilehomes, and emergency shelters, and shall make adequate
provision for the existing and projected needs of all economic
segments of the community. The element shall contain all of the
following:
   (a) An assessment of housing needs and an inventory of resources
and constraints relevant to the meeting of these needs. The
assessment and inventory shall include all of the following:
   (1) An analysis of population and employment trends and
documentation of projections and a quantification of the locality's
existing and projected housing needs for all income levels, including
extremely low income households, as defined in subdivision (b) of
Section 50105 and Section 50106 of the Health and Safety Code. These
existing and projected needs shall include the locality's share of
the regional housing need in accordance with Section 65584. Local
agencies shall calculate the subset of very low income households
allotted under Section 65584 that qualify as extremely low income
households. The local agency may either use available census data to
calculate the percentage of very low income households that qualify
as extremely low income households or presume that 50 percent of the
very low income households qualify as extremely low income
households. The number of extremely low income households and very
low income households shall equal the jurisdiction's allocation of
very low income households pursuant to Section 65584.
   (2) An analysis and documentation of household characteristics,
including level of payment compared to ability to pay, housing
characteristics, including overcrowding, and housing stock condition.

   (3) An inventory of land suitable for residential development,
including vacant sites and sites having potential for redevelopment,
and an analysis of the relationship of zoning and public facilities
and services to these sites.
   (4) (A) The identification of a zone or zones where emergency
shelters are allowed as a permitted use without a conditional use or
other discretionary permit. The identified zone or zones shall
include sufficient capacity to accommodate the need for emergency
shelter identified in paragraph (7), except that each local
government shall identify a zone or zones that can accommodate at
least one year-round emergency shelter. If the local government
cannot identify a zone or zones with sufficient capacity, the local
government shall include a program to amend its zoning ordinance to
meet the requirements of this paragraph within one year of the
adoption of the housing element. The local government may identify
additional zones where emergency shelters are permitted with a
conditional use permit. The local government shall also demonstrate
that existing or proposed permit processing, development, and
management standards are objective and encourage and facilitate the
development of, or conversion to, emergency shelters. Emergency
shelters may only be subject to those development and management
standards that apply to residential or commercial development within
the same zone except that a local government may apply written,
objective standards that include all of the following:
   (i) The maximum number of beds or persons permitted to be served
nightly by the facility.
   (ii) Off-street parking based upon demonstrated need, provided
that the standards do not require more parking for emergency shelters
than for other residential or commercial uses within the same zone.
   (iii) The size and location of exterior and interior onsite
waiting and client intake areas.
   (iv) The provision of onsite management.
   (v) The proximity to other emergency shelters, provided that
emergency shelters are not required to be more than 300 feet apart.
   (vi) The length of stay.
   (vii) Lighting.
   (viii) Security during hours that the emergency shelter is in
operation.
   (B) The permit processing, development, and management standards
applied under this paragraph shall not be deemed to be discretionary
acts within the meaning of the California Environmental Quality Act
(Division 13 (commencing with Section 21000) of the Public Resources
Code).
   (C) A local government that can demonstrate to the satisfaction of
the department the existence of one or more emergency shelters
either within its jurisdiction or pursuant to a multijurisdictional
agreement that can accommodate that jurisdiction's need for emergency
shelter identified in paragraph (7) may comply with the zoning
requirements of subparagraph (A) by identifying a zone or zones where
new emergency shelters are allowed with a conditional use permit.
   (D) A local government with an existing ordinance or ordinances
that comply with this paragraph shall not be required to take
additional action to identify zones for emergency shelters. The
housing element must only describe how existing ordinances, policies,
and standards are consistent with the requirements of this
paragraph.
   (5) An analysis of potential and actual governmental constraints
upon the maintenance, improvement, or development of housing for all
income levels, including the types of housing identified in paragraph
(1) of subdivision (c), and for persons with disabilities as
identified in the analysis pursuant to paragraph (7), including land
use controls, building codes and their enforcement, site
improvements, fees and other exactions required of developers, and
local processing and permit procedures. The analysis shall also
demonstrate local efforts to remove governmental constraints that
hinder the locality from meeting its share of the regional housing
need in accordance with Section 65584 and from meeting the need for
housing for persons with disabilities, supportive housing,
transitional housing, and emergency shelters identified pursuant to
paragraph (7). Transitional housing and supportive housing shall be
considered a residential use of property, and shall be subject only
to those restrictions that apply to other residential dwellings of
the same type in the same zone.
   (6) An analysis of potential and actual nongovernmental
constraints upon the maintenance, improvement, or development of
housing for all income levels, including the availability of
financing, the price of land, and the cost of construction.
   (7) An analysis of any special housing needs, such as those of the
elderly, persons with disabilities, large families, farmworkers,
families with female heads of households, and families and persons in
need of emergency shelter. The need for emergency shelter shall be
assessed based on annual and seasonal need. The need for emergency
shelter may be reduced by the number of supportive housing units that
are identified in an adopted 10-year plan to end chronic
homelessness and that are either vacant or for which funding has been
identified to allow construction during the planning period.
   (8) An analysis of opportunities for energy conservation with
respect to residential development. Cities and counties are
encouraged to include weatherization and energy efficiency
improvements as part of publicly subsidized housing rehabilitation
projects. This may include energy efficiency measures that encompass
the building envelope, its heating and cooling systems, and its
electrical system.
   (9) An analysis of existing assisted housing developments that are
eligible to change from low-income housing uses during the next 10
years due to termination of subsidy contracts, mortgage prepayment,
or expiration of restrictions on use. "Assisted housing developments,"
for the purpose of this section, shall mean multifamily rental
housing that receives governmental assistance under federal programs
listed in subdivision (a) of Section 65863.10, state and local
multifamily revenue bond programs, local redevelopment programs, the
federal Community Development Block Grant Program, or local in-lieu
fees. "Assisted housing developments" shall also include multifamily
rental units that were developed pursuant to a local inclusionary
housing program or used to qualify for a density bonus pursuant to
Section 65916.
   (A) The analysis shall include a listing of each development by
project name and address, the type of governmental assistance
received, the earliest possible date of change from low-income use,
and the total number of elderly and nonelderly units that could be
lost from the locality's low-income housing stock in each year during
the 10-year period. For purposes of state and federally funded
projects, the analysis required by this subparagraph need only
contain information available on a statewide basis.
             (B) The analysis shall estimate the total cost of
producing new rental housing that is comparable in size and rent
levels, to replace the units that could change from low-income use,
and an estimated cost of preserving the assisted housing
developments. This cost analysis for replacement housing may be done
aggregately for each five-year period and does not have to contain a
project-by-project cost estimate.
   (C) The analysis shall identify public and private nonprofit
corporations known to the local government which have legal and
managerial capacity to acquire and manage these housing developments.

   (D) The analysis shall identify and consider the use of all
federal, state, and local financing and subsidy programs which can be
used to preserve, for lower income households, the assisted housing
developments, identified in this paragraph, including, but not
limited to, federal Community Development Block Grant Program funds,
tax increment funds received by a redevelopment agency of the
community, and administrative fees received by a housing authority
operating within the community. In considering the use of these
financing and subsidy programs, the analysis shall identify the
amounts of funds under each available program which have not been
legally obligated for other purposes and which could be available for
use in preserving assisted housing developments.
   (b) (1) A statement of the community's goals, quantified
objectives, and policies relative to the maintenance, preservation,
improvement, and development of housing.
   (2) It is recognized that the total housing needs identified
pursuant to subdivision (a) may exceed available resources and the
community's ability to satisfy this need within the content of the
general plan requirements outlined in Article 5 (commencing with
Section 65300). Under these circumstances, the quantified objectives
need not be identical to the total housing needs. The quantified
objectives shall establish the maximum number of housing units by
income category, including extremely low income, that can be
constructed, rehabilitated, and conserved over a five-year time
period.
   (c) A program which sets forth a schedule of actions during the
planning period, each with a timeline for implementation, which may
recognize that certain programs are ongoing, such that there will be
beneficial impacts of the programs within the planning period, that
the local government is undertaking or intends to undertake to
implement the policies and achieve the goals and objectives of the
housing element through the administration of land use and
development controls, the provision of regulatory concessions and
incentives, the utilization of appropriate federal and state
financing and subsidy programs when available, and the utilization of
moneys in a low- and moderate-income housing fund of an agency if
the locality has established a redevelopment project area pursuant to
the Community Redevelopment Law (Division 24 (commencing with
Section 33000) of the Health and Safety Code). In order to make
adequate provision for the housing needs of all economic segments of
the community, the program shall do all of the following:
   (1) Identify actions that will be taken to make sites available
during the planning period of the general plan with appropriate
zoning and development standards and with services and facilities to
accommodate that portion of the city's or county's share of the
regional housing need for each income level that could not be
accommodated on sites identified in the inventory completed pursuant
to paragraph (3) of subdivision (a) without rezoning, and to comply
with the requirements of Section 65584.09. Sites shall be identified
as needed to facilitate and encourage the development of a variety of
types of housing for all income levels, including multifamily rental
housing, factory-built housing, mobilehomes, housing for
agricultural employees, supportive housing, single-room occupancy
units, emergency shelters, and transitional housing.
   (A) Where the inventory of sites, pursuant to paragraph (3) of
subdivision (a), does not identify adequate sites to accommodate the
need for groups of all household income levels pursuant to Section
65584, rezoning of those sites, including adoption of minimum density
and development standards, for jurisdictions with an eight-year
housing element planning period pursuant to Section 65588, shall be
completed no later than three years after either the date the housing
element is adopted pursuant to subdivision (f) of Section 65585 or
the date that is 90 days after receipt of comments from the
department pursuant to subdivision (b) of Section 65585, whichever is
earlier, unless the deadline is extended pursuant to subdivision
(f). Notwithstanding the foregoing, for a local government that fails
to adopt a housing element within 120 days of the statutory deadline
in Section 65588 for adoption of the housing element, rezoning of
those sites, including adoption of minimum density and development
standards, shall be completed no later than three years and 120 days
from the statutory deadline in Section 65588 for adoption of the
housing element.
   (B) Where the inventory of sites, pursuant to paragraph (3) of
subdivision (a), does not identify adequate sites to accommodate the
need for groups of all household income levels pursuant to Section
65584, the program shall identify sites that can be developed for
housing within the planning period pursuant to subdivision (h) of
Section 65583.2. The identification of sites shall include all
components specified in subdivision (b) of Section 65583.2.
   (C) Where the inventory of sites pursuant to paragraph (3) of
subdivision (a) does not identify adequate sites to accommodate the
need for farmworker housing, the program shall provide for sufficient
sites to meet the need with zoning that permits farmworker housing
use by right, including density and development standards that could
accommodate and facilitate the feasibility of the development of
farmworker housing for low- and very low income households.
   (2) Assist in the development of adequate housing to meet the
needs of extremely low, very low, low-, and moderate-income
households.
   (3) Address and, where appropriate and legally possible, remove
governmental constraints to the maintenance, improvement, and
development of housing, including housing for all income levels and
housing for persons with disabilities. The program shall remove
constraints to, and provide reasonable accommodations for housing
designed for, intended for occupancy by, or with supportive services
for, persons with disabilities.
   (4) Conserve and improve the condition of the existing affordable
housing stock, which may include addressing ways to mitigate the loss
of dwelling units demolished by public or private action.
   (5) Promote housing opportunities for all persons regardless of
race, religion, sex, marital status, ancestry, national origin,
color, familial status, or disability.
   (6) Preserve for lower income households the assisted housing
developments identified pursuant to paragraph (9) of subdivision (a).
The program for preservation of the assisted housing developments
shall utilize, to the extent necessary, all available federal, state,
and local financing and subsidy programs identified in paragraph (9)
of subdivision (a), except where a community has other urgent needs
for which alternative funding sources are not available. The program
may include strategies that involve local regulation and technical
assistance.
   (7) The program shall include an identification of the agencies
and officials responsible for the implementation of the various
actions and the means by which consistency will be achieved with
other general plan elements and community goals. The local government
shall make a diligent effort to achieve public participation of all
economic segments of the community in the development of the housing
element, and the program shall describe this effort.
   (d) (1) A local government may satisfy all or part of its
requirement to identify a zone or zones suitable for the development
of emergency shelters pursuant to paragraph (4) of subdivision (a) by
adopting and implementing a multijurisdictional agreement, with a
maximum of two other adjacent communities, that requires the
participating jurisdictions to develop at least one year-round
emergency shelter within two years of the beginning of the planning
period.
   (2) The agreement shall allocate a portion of the new shelter
capacity to each jurisdiction as credit towards its emergency shelter
need, and each jurisdiction shall describe how the capacity was
allocated as part of its housing element.
   (3) Each member jurisdiction of a multijurisdictional agreement
shall describe in its housing element all of the following:
   (A) How the joint facility will meet the jurisdiction's emergency
shelter need.
   (B) The jurisdiction's contribution to the facility for both the
development and ongoing operation and management of the facility.
   (C) The amount and source of the funding that the jurisdiction
contributes to the facility.
   (4) The aggregate capacity claimed by the participating
jurisdictions in their housing elements shall not exceed the actual
capacity of the shelter.
   (e) Except as otherwise provided in this article, amendments to
this article that alter the required content of a housing element
shall apply to both of the following:
   (1) A housing element or housing element amendment prepared
pursuant to subdivision (e) of Section 65588 or Section 65584.02,
when a city, county, or city and county submits a draft to the
department for review pursuant to Section 65585 more than 90 days
after the effective date of the amendment to this section.
   (2) Any housing element or housing element amendment prepared
pursuant to subdivision (e) of Section 65588 or Section 65584.02,
when the city, county, or city and county fails to submit the first
draft to the department before the due date specified in Section
65588 or 65584.02.
   (f) The deadline for completing required rezoning pursuant to
subparagraph (A) of paragraph (1) of subdivision (c) shall be
extended by one year if the local government has completed the
rezoning at densities sufficient to accommodate at least 75 percent
of the units for low- and very low income households and if the
legislative body at the conclusion of a public hearing determines,
based upon substantial evidence, that any of the following
circumstances exist:
   (1) The local government has been unable to complete the rezoning
because of the action or inaction beyond the control of the local
government of any other state, federal, or local agency.
   (2) The local government is unable to complete the rezoning
because of infrastructure deficiencies due to fiscal or regulatory
constraints.
   (3) The local government must undertake a major revision to its
general plan in order to accommodate the housing-related policies of
a sustainable communities strategy or an alternative planning
strategy adopted pursuant to Section 65080.
   The resolution and the findings shall be transmitted to the
department together with a detailed budget and schedule for
preparation and adoption of the required rezonings, including plans
for citizen participation and expected interim action. The schedule
shall provide for adoption of the required rezoning within one year
of the adoption of the resolution.
   (g) (1) If a local government fails to complete the rezoning by
the deadline provided in subparagraph (A) of paragraph (1) of
subdivision (c), as it may be extended pursuant to subdivision (f),
except as provided in paragraph (2), a local government may not
disapprove a housing development project, nor require a conditional
use permit, planned unit development permit, or other locally imposed
discretionary permit, or impose a condition that would render the
project infeasible, if the housing development project (A) is
proposed to be located on a site required to be rezoned pursuant to
the program action required by that subparagraph and (B) complies
with applicable, objective general plan and zoning standards and
criteria, including design review standards, described in the program
action required by that subparagraph. Any subdivision of sites shall
be subject to the Subdivision Map Act (Division 2 (commencing with
Section 66410)). Design review shall not constitute a "project" for
purposes of Division 13 (commencing with Section 21000) of the Public
Resources Code.
   (2) A local government may disapprove a housing development
described in paragraph (1) if it makes written findings supported by
substantial evidence on the record that both of the following
conditions exist:
   (A) The housing development project would have a specific, adverse
impact upon the public health or safety unless the project is
disapproved or approved upon the condition that the project be
developed at a lower density. As used in this paragraph, a "specific,
adverse impact" means a significant, quantifiable, direct, and
unavoidable impact, based on objective, identified written public
health or safety standards, policies, or conditions as they existed
on the date the application was deemed complete.
   (B) There is no feasible method to satisfactorily mitigate or
avoid the adverse impact identified pursuant to paragraph (1), other
than the disapproval of the housing development project or the
approval of the project upon the condition that it be developed at a
lower density.
   (3) The applicant or any interested person may bring an action to
enforce this subdivision. If a court finds that the local agency
disapproved a project or conditioned its approval in violation of
this subdivision, the court shall issue an order or judgment
compelling compliance within 60 days. The court shall retain
jurisdiction to ensure that its order or judgment is carried out. If
the court determines that its order or judgment has not been carried
out within 60 days, the court may issue further orders to ensure that
the purposes and policies of this subdivision are fulfilled. In any
such action, the city, county, or city and county shall bear the
burden of proof.
   (4) For purposes of this subdivision, "housing development project"
means a project to construct residential units for which the project
developer provides sufficient legal commitments to the appropriate
local agency to ensure the continued availability and use of at least
49 percent of the housing units for very low, low-, and
moderate-income households with an affordable housing cost or
affordable rent, as defined in Section 50052.5 or 50053 of the Health
and Safety Code, respectively, for the period required by the
applicable financing.
   (h) An action to enforce the program actions of the housing
element shall be brought pursuant to Section 1085 of the Code of
Civil Procedure.
  SEC. 97.  Section 66540.12 of the Government Code is amended to
read:
   66540.12.  (a) The authority shall be governed by a board composed
of five members, as follows:
   (1) Three members shall be appointed by the Governor, subject to
confirmation by the Senate. The Governor shall make the initial
appointment of these members of the board no later than January 11,
2008.
   (2) One member shall be appointed by the Senate Committee on
Rules.
   (3) One member shall be appointed by the Speaker of the Assembly.
   (b) Each member of the board shall be a resident of a county in
the bay area region.
   (c) Public officers associated with an area of government,
including planning or water, whether elected or appointed, may be
appointed to serve contemporaneously as members of the board. A
public agency shall not have more than one representative on the
board of the authority.
   (d) The Governor shall designate one member as the chairperson of
the board and one member as the vice chairperson of the board.
   (e) The term of a member of the board shall be six years.
   (f) Vacancies shall be filled immediately by the appointing power
for the unexpired portion of the terms in which they occur.
  SEC. 98.  Section 66540.32 of the Government Code is amended to
read:
   66540.32.  (a) The authority shall create and adopt, on or before
July 1, 2009, an emergency water transportation system management
plan for water transportation services in the bay area region in the
event that bridges, highways, and other facilities are rendered
wholly or significantly inoperable.
   (b) (1) The authority shall create and adopt, on or before July 1,
2009, a transition plan to facilitate the transfer of existing
public transportation ferry services within the bay area region to
the authority pursuant to this title. In the preparation of the
transition plan, priority shall be given to ensuring continuity in
the programs, services, and activities of existing public
transportation ferry services.
   (2) The plan required by this subdivision shall include all of the
following:
   (A) A description of existing ferry services in the bay area
region, as of January 1, 2008, that are to be transferred to the
authority pursuant to Section 66540.11 and a description of any
proposed changes to those services.
   (B) A description of any proposed expansion of ferry services in
the bay area region.
   (C) An inventory of the ferry and ferry-related capital assets or
leasehold interests, including, but not limited to, vessels,
terminals, maintenance facilities, and existing or planned parking
facilities or parking structures, and of the personnel, operating
costs, and revenues of public agencies operating public
transportation ferries and providing water transportation services as
of January 1, 2008, and those facilities that are to be transferred,
in whole or in part, to the authority pursuant to Section 66540.11.
   (D) A description of those capital assets, leasehold interests,
and personnel identified in subparagraph (C) that the authority
proposes to be transferred pursuant to Section 66540.11.
   (E) An operating plan that includes, at a minimum, an estimate of
the costs to continue the ferry services described in subparagraph
(A) for at least five years and a detailed description of current and
historically available revenues and proposed sources of revenue to
meet those anticipated costs. Further, the operating plan shall
identify options for closing any projected deficits or for addressing
increased cost inputs, such as fuel, for at least the five-year
period.
   (F) A description of the proposed services, duties, functions,
responsibilities, and liabilities of the authority and those of
agencies providing or proposed to provide water transportation
services for the authority.
   (G) To the extent the plan may include the transfer of assets or
services from a local agency to the authority pursuant to Section
66540.11, that transfer shall be subject to negotiation and agreement
by the local agency. The authority and the local agency shall
negotiate and agree on fair terms, including just compensation, prior
to any transfer authorized by this title.
   (H) An initial five-year Capital Improvement Program (CIP)
detailing how the authority and its local agency partners plan to
support financing and completion of capital improvement projects,
including, but not limited to, those described in subparagraph (C),
that are required to support the operation of transferred ferry
services. Priority shall be given to emergency response projects and
those capital improvement projects for which a Notice of
Determination pursuant to the California Environmental Quality Act
(Division 13 (commencing with Section 21000) of the Public Resources
Code) has been filed and which further the expansion, efficiency, or
effectiveness of the ferry system.
   (I) A description of how existing and expanded water
transportation services will provide seamless connections to other
transit providers in the bay area region, including, but not limited
to, a description of how the authority will coordinate with all local
agencies to ensure optimal public transportation services, including
supplemental bus services that existed on January 1, 2008, that
support access to the ferry system for the immediate and surrounding
communities.
   (J) The date on which the ferry services are to be transferred to
the authority.
   (3) To the extent the plan required by this subdivision includes
proposed changes to water transportation services or related
facilities historically provided by the City of Vallejo or the City
of Alameda, the proposed changes shall be consistent with that city's
general plan, its redevelopment plans, and its development and
disposition agreements for projects related to the provision of water
transportation services. Those projects include, but are not limited
to, the construction of parking facilities and transit transfer
facilities within close proximity of a ferry terminal or the
relocation of a ferry terminal.
   (c) In developing the plans described in subdivisions (a) and (b),
the authority shall cooperate to the fullest extent possible with
the Metropolitan Transportation Commission, the California Emergency
Management Agency (Cal EMA), the Association of Bay Area Governments,
and the San Francisco Bay Conservation and Development Commission,
and shall, to the fullest extent possible, coordinate its planning
with local agencies, including those local agencies that operated, or
contracted for the operation of, public water transportation
services as of the effective date of this title. To avoid duplication
of work, the authority shall make maximum use of data and
information available from the planning programs of the Metropolitan
Transportation Commission, (Cal EMA), the Association of Bay Area
Governments, the San Francisco Bay Conservation and Development
Commission, the cities and counties in the San Francisco Bay area,
and other public and private planning agencies. In addition, the
authority shall consider both of the following:
   (1) The San Francisco Bay Area Water Transit Implementation and
Operations Plan adopted by the San Francisco Bay Area Water Transit
Authority on July 10, 2003.
   (2) Any other plan concerning water transportation within the bay
area region developed or adopted by a general purpose local
government or special district that operates or sponsors water
transit, including, but not limited to, those water transportation
services provided under agreement with a private operator.
   (d) The authority shall prepare a specific transition plan for any
transfer not anticipated by the transition plan required under
subdivision (b).
   (e) Prior to adopting the plans required by this section, the
authority shall establish a process for taking public input on the
plans in consultation with existing operators of public ferry
services affected by the plans. The public input process shall
include at least one public hearing conducted at least 60 days prior
to the adoption of the plans in each city where an operational ferry
facility existed as of January 1, 2008.
  SEC. 99.  Section 70375 of the Government Code is amended to read:
   70375.  (a) This article shall take effect on January 1, 2003, and
the fund, penalty, and fee assessment established by this article
shall become operative on January 1, 2003, except as otherwise
provided in this article.
   (b) In each county, the five-dollar ($5) penalty amount authorized
by subdivision (a) of Section 70372 shall be reduced by the amount
collected for transmission to the state for inclusion in the
Transitional State Court Facilities Construction Fund established
pursuant to Section 70401 to the extent it is funded by moneys from
the local courthouse construction fund.
   (c) The authority for all of the following shall expire
proportionally on June 30 following the date of transfer of
responsibility for facilities from the county to the Judicial
Council, except so long as moneys are needed to pay for construction
provided for in those sections and undertaken prior to the transfer
of responsibility for facilities from the county to the Judicial
Council:
   (1) An additional penalty for a local courthouse construction fund
established pursuant to Section 76100.
   (2) A filing fee surcharge in the County of Riverside established
pursuant to Section 70622.
   (3) A filing fee surcharge in the County of San Bernardino
established pursuant to Section 70624.
   (4) A filing fee surcharge in the City and County of San Francisco
established pursuant to Section 70625.
   (d) For purposes of subdivision (c), "proportionally" means the
proportion of the fee or surcharge that shall expire upon the
transfer of responsibility for a facility that is the same proportion
as the square footage that facility bears to the total square
footage of court facilities in that county.
  SEC. 100.  Section 70391 of the Government Code is amended to read:

   70391.  The Judicial Council, as the policymaking body for the
judicial branch, shall have the following responsibilities and
authorities with regard to court facilities, in addition to any other
responsibilities or authorities established by law:
   (a) Exercise full responsibility, jurisdiction, control, and
authority as an owner would have over trial court facilities the
title of which is held by the state, including, but not limited to,
the acquisition and development of facilities.
   (b) Exercise the full range of policymaking authority over trial
court facilities, including, but not limited to, planning,
construction, acquisition, and operation, to the extent not expressly
otherwise limited by law.
   (c) Dispose of surplus court facilities following the transfer of
responsibility under Article 3 (commencing with Section 70321),
subject to all of the following:
   (1) If the property was a court facility previously the
responsibility of the county, the Judicial Council shall comply with
the requirements of Section 11011, and as follows, except that,
notwithstanding any other provision of law, the proportion of the net
proceeds that represents the proportion of other state funds used on
the property other than for operation and maintenance shall be
returned to the fund from which it came and the remainder of the
proceeds shall be deposited in the State Court Facilities
Construction Fund.
   (2) The Judicial Council shall consult with the county concerning
the disposition of the facility. Notwithstanding any other law,
including Section 11011, when requested by the transferring county, a
surplus facility shall be offered to that county at fair market
value prior to being offered to another state agency or local
government agency.
                                                            (3) The
Judicial Council shall consider whether the potential new or planned
use of the facility:
   (A) Is compatible with the use of other adjacent public buildings.

   (B) Unreasonably departs from the historic or local character of
the surrounding property or local community.
   (C) Has a negative impact on the local community.
   (D) Unreasonably interferes with other governmental agencies that
use or are located in or adjacent to the building containing the
court facility.
   (E) Is of sufficient benefit to outweigh the public good in
maintaining it as a court facility or building.
   (4) All funds received for disposal of surplus court facilities
shall be deposited by the Judicial Council in the State Court
Facilities Construction Fund.
   (5) If the facility was acquired, rehabilitated, or constructed,
in whole or in part, with moneys in the State Court Facilities
Construction Fund that were deposited in that fund from the state
fund, any funds received for disposal of that facility shall be
apportioned to the state fund and the State Court Facilities
Construction Fund in the same proportion that the original cost of
the building was paid from the state fund and other sources of the
State Court Facilities Construction Fund.
   (6) Submission of a plan to the Legislature for the disposition of
court facilities transferred to the state, prior to, or as part of,
any budget submission to fund a new courthouse that will replace the
existing court facilities transferred to the state.
   (d) Conduct audits of all of the following:
   (1) The collection of fees by the local courts.
   (2) The moneys in local courthouse construction funds established
pursuant to Section 76100.
   (3) The collection of moneys to be transmitted to the Controller
for deposit in the Immediate and Critical Needs Account of the State
Court Facilities Construction Fund, established in Section 70371.5.
   (e) Establish policies, procedures, and guidelines for ensuring
that the courts have adequate and sufficient facilities, including,
but not limited to, facilities planning, acquisition, construction,
design, operation, and maintenance.
   (f) Establish and consult with local project advisory groups on
the construction of new trial court facilities, including the trial
court, the county, the local sheriff, state agencies, bar groups,
including, but not limited to, the criminal defense bar, and members
of the community. Consultation with the local sheriff in design,
planning, and construction shall include the physical layout of new
facilities, as it relates to court security and other security
considerations, including matters relating to the safe control and
transport of in-custody defendants.
   (g) Manage court facilities in consultation with the trial courts.

   (h) Allocate appropriated funds for court facilities maintenance
and construction, subject to the other provisions of this chapter.
   (i) Manage shared-use facilities to the extent required by the
agreement under Section 70343.
   (j) Prepare funding requests for court facility construction,
repair, and maintenance.
   (k) Implement the design, bid, award, and construction of all
court construction projects, except as delegated to others.
   (l) Provide for capital outlay projects that may be built with
funds appropriated or otherwise available for these purposes as
follows:
   (1) Approve five-year and master plans for each district.
   (2) Establish priorities for construction.
   (3) Recommend to the Governor and the Legislature the projects to
be funded by the State Court Facilities Construction Fund.
   (4) Submit the cost of projects proposed to be funded to the
Department of Finance for inclusion in the Governor's Budget.
   (m) In carrying out its responsibilities and authority under this
section, the Judicial Council shall consult with the local court for:

   (1) Selecting and contracting with facility consultants.
   (2) Preparing and reviewing architectural programs and designs for
court facilities.
   (3) Preparing strategic master and five-year capital facilities
plans.
   (4) Major maintenance of a facility.
  SEC. 101.  Section 76000 of the Government Code is amended to read:

   76000.  (a) (1) Except as otherwise provided in this section, in
each county there shall be levied an additional penalty in the amount
of seven dollars ($7) for every ten dollars ($10), or part of ten
dollars ($10), upon every fine, penalty, or forfeiture imposed and
collected by the courts for all criminal offenses, including all
offenses involving a violation of the Vehicle Code or a local
ordinance adopted pursuant to the Vehicle Code.
   (2) The additional penalty shall be collected together with and in
the same manner as the amounts established by Section 1464 of the
Penal Code. The moneys shall be taken from fines and forfeitures
deposited with the county treasurer prior to any division pursuant to
Section 1463 of the Penal Code. The county treasurer shall deposit
those amounts specified by the board of supervisors by resolution in
one or more of the funds established pursuant to this chapter.
However, deposits to these funds shall continue through whatever
period of time is necessary to repay any borrowings made by the
county on or before January 1, 1991, to pay for construction provided
for in this chapter.
   (3) This additional penalty does not apply to the following:
   (A) A restitution fine.
   (B) A penalty authorized by Section 1464 of the Penal Code or this
chapter.
   (C) A parking offense subject to Article 3 (commencing with
Section 40200) of Chapter 1 of Division 17 of the Vehicle Code.
   (D) The state surcharge authorized by Section 1465.7 of the Penal
Code.
   (b) In each authorized county, provided that the board of
supervisors has adopted a resolution stating that the implementation
of this subdivision is necessary to the county for the purposes
authorized, with respect to each authorized fund established pursuant
to Section 76100 or 76101, for every parking offense where a parking
penalty, fine, or forfeiture is imposed, an added penalty of two
dollars and fifty cents ($2.50) shall be included in the total
penalty, fine, or forfeiture. Except as provided in subdivision (c),
for each parking case collected in the courts of the county, the
county treasurer shall place in each authorized fund two dollars and
fifty cents ($2.50). The moneys shall be taken from fines and
forfeitures deposited with the county treasurer prior to any division
pursuant to Section 1463.009 of the Penal Code. The judges of the
county shall increase the bail schedule amounts as appropriate to
reflect the added penalty provided for by this section. In cities,
districts, or other issuing agencies that elect to accept parking
penalties, and otherwise process parking violations pursuant to
Article 3 (commencing with Section 40200) of Chapter 1 of Division 17
of the Vehicle Code, the city, district, or issuing agency shall
observe the increased bail amounts as established by the court
reflecting the added penalty provided for by this section. Each
agency that elects to process parking violations shall pay to the
county treasurer two dollars and fifty cents ($2.50) for each fund
for each parking penalty collected on each violation that is not
filed in court. Those payments to the county treasurer shall be made
monthly, and the county treasurer shall deposit all those sums in the
authorized fund. An issuing agency shall not be required to
contribute revenues to a fund in excess of those revenues generated
from the surcharges established in the resolution adopted pursuant to
this chapter, except as otherwise agreed upon by the local
governmental entities involved.
   (c) The county treasurer shall deposit one dollar ($1) of every
two dollars and fifty cents ($2.50) collected pursuant to subdivision
(b) into the general fund of the county.
   (d) The authority to impose the two-dollar-and-fifty-cent ($2.50)
penalty authorized by subdivision (b) shall be reduced to one dollar
($1) as of the date of transfer of responsibility for facilities from
the county to the Judicial Council pursuant to Article 3 (commencing
with Section 70321) of Chapter 5.7, except as moneys are needed to
pay for construction provided for in Section 76100 and undertaken
prior to the transfer of responsibility for facilities from the
county to the Judicial Council.
   (e) The seven-dollar ($7) additional penalty authorized by
subdivision (a) shall be reduced in each county by the additional
penalty amount assessed by the county for the local courthouse
construction fund established by Section 76100 as of January 1, 1998,
when the moneys in that fund are transferred to the state under
Section 70402. The amount each county shall charge as an additional
penalty under this section shall be as follows:
                                    San Luis
Alameda    $5.00 Marin       $5.00 Obispo      $6.00
Alpine     $5.00 Mariposa    $2.00 San Mateo   $4.75
                                    Santa
Amador     $5.00 Mendocino   $7.00 Barbara     $3.50
Butte      $6.00 Merced      $5.00 Santa Clara $5.50
Calaveras  $3.00 Modoc       $4.00 Santa Cruz  $7.00
Colusa     $6.00 Mono        $5.00 Shasta      $3.50
Contra
Costa      $5.00 Monterey    $5.00 Sierra      $7.00
Del Norte  $5.00 Napa        $3.00 Siskiyou    $5.00
El Dorado  $5.00 Nevada      $5.00 Solano      $5.00
Fresno     $7.00 Orange      $3.50 Sonoma      $5.00
Glenn      $4.06 Placer      $4.75 Stanislaus  $5.00
Humboldt   $5.00 Plumas      $5.00 Sutter      $3.00
Imperial   $6.00 Riverside   $4.60 Tehama      $7.00
Inyo       $4.00 Sacramento  $5.00 Trinity     $4.26
Kern       $7.00 San Benito  $5.00 Tulare      $5.00
                  San
Kings      $7.00 Bernardino  $5.00 Tuolumne    $5.00
Lake       $7.00 San Diego   $5.00 Ventura     $5.00
                  San
Lassen     $2.00 Francisco   $6.99 Yolo        $7.00
Los
Angeles    $5.00 San Joaquin $3.75 Yuba        $3.00
Madera     $7.00


  SEC. 102.  Section 76000.5 of the Government Code is amended to
read:
   76000.5.  (a) (1) Except as otherwise provided in this section,
for purposes of supporting emergency medical services pursuant to
Chapter 2.5 (commencing with Section 1797.98a) of Division 2.5 of the
Health and Safety Code, in addition to the penalties set forth in
Section 76000, the county board of supervisors may elect to levy an
additional penalty in the amount of two dollars ($2) for every ten
dollars ($10), or part of ten dollars ($10), upon every fine,
penalty, or forfeiture imposed and collected by the courts for all
criminal offenses, including violations of Division 9 (commencing
with Section 23000) of the Business and Professions Code relating to
the control of alcoholic beverages, and all offenses involving a
violation of the Vehicle Code or a local ordinance adopted pursuant
to the Vehicle Code. This penalty shall be collected together with
and in the same manner as the amounts established by Section 1464 of
the Penal Code.
   (2) This additional penalty does not apply to the following:
   (A) A restitution fine.
   (B) A penalty authorized by Section 1464 of the Penal Code or this
chapter.
   (C) A parking offense subject to Article 3 (commencing with
Section 40200) of Chapter 1 of Division 17 of the Vehicle Code.
   (D) The state surcharge authorized by Section 1465.7 of the Penal
Code.
   (b) Funds shall be collected pursuant to subdivision (a) only if
the county board of supervisors provides that the increased penalties
do not offset or reduce the funding of other programs from other
sources, but that these additional revenues result in increased
funding to those programs.
   (c) Moneys collected pursuant to subdivision (a) shall be taken
from fines and forfeitures deposited with the county treasurer prior
to any division pursuant to Section 1463 of the Penal Code.
   (d) Funds collected pursuant to this section shall be deposited
into the Maddy Emergency Medical Services (EMS) Fund established
pursuant to Section 1797.98a of the Health and Safety Code.
   (e) This section shall remain in effect only until January 1,
2014, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2014, deletes or extends
that date.
  SEC. 103.  Section 76104.6 of the Government Code is amended to
read:
   76104.6.  (a) (1) Except as otherwise provided in this section,
for the purpose of implementing the DNA Fingerprint, Unsolved Crime
and Innocence Protection Act (Proposition 69), as approved by the
voters at the November 2, 2004, statewide general election, there
shall be levied an additional penalty of one dollar for every ten
dollars ($10), or part of ten dollars ($10), in each county upon
every fine, penalty, or forfeiture imposed and collected by the
courts for all criminal offenses, including all offenses involving a
violation of the Vehicle Code or a local ordinance adopted pursuant
to the Vehicle Code.
   (2) The penalty imposed by this section shall be collected
together with and in the same manner as the amounts established by
Section 1464 of the Penal Code. The moneys shall be taken from fines
and forfeitures deposited with the county treasurer prior to any
division pursuant to Section 1463 of the Penal Code. The board of
supervisors shall establish in the county treasury a DNA
Identification Fund into which shall be deposited the moneys
collected pursuant to this section. The moneys of the fund shall be
allocated pursuant to subdivision (b).
   (3) The additional penalty does not apply to the following:
   (A) A restitution fine.
   (B) A penalty authorized by Section 1464 of the Penal Code or this
chapter.
   (C) A parking offense subject to Article 3 (commencing with
Section 40200) of Chapter 1 of Division 17 of the Vehicle Code.
   (D) The state surcharge authorized by Section 1465.7 of the Penal
Code.
   (b) (1) The fund moneys described in subdivision (a), together
with any interest earned thereon, shall be held by the county
treasurer separate from any funds subject to transfer or division
pursuant to Section 1463 of the Penal Code. Deposits to the fund may
continue through and including the 20th year after the initial
calendar year in which the surcharge is collected, or longer if and
as necessary to make payments upon any lease or leaseback arrangement
utilized to finance any of the projects specified herein.
   (2) On the last day of each calendar quarter of the year specified
in this subdivision, the county treasurer shall transfer fund moneys
in the county's DNA Identification Fund to the Controller for credit
to the state's DNA Identification Fund, which is hereby established
in the State Treasury, as follows:
   (A) In the first two calendar years following the effective date
of this section, 70 percent of the amounts collected, including
interest earned thereon.
   (B) In the third calendar year following the effective date of
this section, 50 percent of the amounts collected, including interest
earned thereon.
   (C) In the fourth calendar year following the effective date of
this section and in each calendar year thereafter, 25 percent of the
amounts collected, including interest earned thereon.
   (3) Funds remaining in the county's DNA Identification Fund shall
be used only to reimburse local sheriff or other law enforcement
agencies to collect DNA specimens, samples, and print impressions
pursuant to this chapter; for expenditures and administrative costs
made or incurred to comply with the requirements of paragraph (5) of
subdivision (b) of Section 298 of the Penal Code including the
procurement of equipment and software integral to confirming that a
person qualifies for entry into the Department of Justice DNA and
Forensic Identification Database and Data Bank Program; and to local
sheriff, police, district attorney, and regional state crime
laboratories for expenditures and administrative costs made or
incurred in connection with the processing, analysis, tracking, and
storage of DNA crime scene samples from cases in which DNA evidence
would be useful in identifying or prosecuting suspects, including the
procurement of equipment and software for the processing, analysis,
tracking, and storage of DNA crime scene samples from unsolved cases.

   (4) The state's DNA Identification Fund shall be administered by
the Department of Justice. Funds in the state's DNA Identification
Fund, upon appropriation by the Legislature, shall be used by the
Attorney General only to support DNA testing in the state and to
offset the impacts of increased testing and shall be allocated as
follows:
   (A) Of the amount transferred pursuant to subparagraph (A) of
paragraph (2) of subdivision (b), 90 percent to the Department of
Justice DNA Laboratory, first, to comply with the requirements of
Section 298.3 of the Penal Code and, second, for expenditures and
administrative costs made or incurred in connection with the
processing, analysis, tracking, and storage of DNA specimens and
samples including the procurement of equipment and software for the
processing, analysis, tracking, and storage of DNA samples and
specimens obtained pursuant to the DNA and Forensic Identification
Database and Data Bank Act of 1998, as amended by Chapter 6
(commencing with Section 295) of Title 9 of Part 1 of the Penal Code,
and 10 percent to the Department of Justice Information Bureau
Criminal History Unit for expenditures and administrative costs that
have been approved by the Chief of the Department of Justice Bureau
of Forensic Services made or incurred to update equipment and
software to facilitate compliance with the requirements of
subdivision (e) of Section 299.5 of the Penal Code.
   (B) Of the amount transferred pursuant to subparagraph (B) of
paragraph (2) of subdivision (b), funds shall be allocated by the
Department of Justice DNA Laboratory, first, to comply with the
requirements of Section 298.3 of the Penal Code and, second, for
expenditures and administrative costs made or incurred in connection
with the processing, analysis, tracking, and storage of DNA specimens
and samples including the procurement of equipment and software for
the processing, analysis, tracking, and storage of DNA samples and
specimens obtained pursuant to the DNA and Forensic Identification
Database and Data Bank Act of 1998, as amended.
   (C) Of the amount transferred pursuant to subparagraph (C) of
paragraph (2) of subdivision (b), funds shall be allocated by the
Department of Justice to the DNA Laboratory to comply with the
requirements of Section 298.3 of the Penal Code and for expenditures
and administrative costs made or incurred in connection with the
processing, analysis, tracking, and storage of DNA specimens and
samples including the procurement of equipment and software for the
processing, analysis, tracking, and storage of DNA samples and
specimens obtained pursuant to the DNA and Forensic Identification
Database and Data Bank Act of 1998, as amended.
   (c) On or before April 1 in the year following adoption of this
section, and annually thereafter, the board of supervisors of each
county shall submit a report to the Legislature and the Department of
Justice. The report shall include the total amount of fines
collected and allocated pursuant to this section, and the amounts
expended by the county for each program authorized pursuant to
paragraph (3) of subdivision (b). The Department of Justice shall
make the reports publicly available on the department's Internet Web
site.
   (d) All requirements imposed on the Department of Justice pursuant
to the DNA Fingerprint, Unsolved Crime and Innocence Protection Act
are contingent upon the availability of funding and are limited by
revenue, on a fiscal year basis, received by the Department of
Justice pursuant to this section and any additional appropriation
approved by the Legislature for purposes related to implementing this
act.
   (e) Upon approval of the DNA Fingerprint, Unsolved Crime and
Innocence Protection Act, the Legislature shall lend the Department
of Justice General Fund in the amount of seven million dollars
($7,000,000) for purposes of implementing the act. The loan shall be
repaid with interest calculated at the rate earned by the Pooled
Money Investment Account at the time the loan is made. Principal and
interest on the loan shall be repaid in full no later than four years
from the date the loan was made and shall be repaid from revenue
generated pursuant to this section.
   (f) Notwithstanding any other provision of law, the Controller may
use the state's DNA Identification Fund, created pursuant to
paragraph (2) of subdivision (b), for loans to the General Fund as
provided in Sections 16310 and 16381. Any such loan shall be repaid
from the General Fund with interest computed at 110 percent of the
Pooled Money Investment Account rate, with the interest commencing to
accrue on the date the loan is made from the fund. This subdivision
does not authorize any transfer that will interfere with the carrying
out of the object for which the state's DNA Identification Fund was
created.
  SEC. 104.  Section 91530 of the Government Code is amended to read:

   91530.  (a) Applications for projects or companies not in
accordance with the reasonable priorities and criteria that an
authority may establish need not be accepted and further processed by
an authority.
   (b) Acceptance of any application in no way obligates an authority
to adopt a resolution of intention or undertake the project
proposed.
   (c) Upon acceptance of any application and request of a company,
the board shall determine whether it is likely that the undertaking
of the project by the authority will be a substantial factor in the
accrual of one or more of the public benefits from the use of the
facilities, including equipment, as proposed in the application,
whether the activities or uses are in accord with Section 91503, and
whether the project is otherwise in accord with the purposes and
requirements of this title.
   (d) Upon affirmative determinations under subdivision (c), the
board may express the present intention of the authority to issue
bonds in connection with the project and shall evidence the same by
the adoption of a resolution of intention to undertake the project.
The resolution of intention shall briefly describe the facilities,
state the estimated principal amount of the bond issue (which
estimate shall not limit the amount of bonds which may be issued),
indicate whether it is expected that the bonds will be tax-exempt or
taxable, and identify the company that is the applicant, and may
include other provisions as the board shall prescribe.
   (e) A notice of the filing of an application, naming the company
that is the applicant, briefly describing the facilities, stating the
estimated principal amount of the bond issue and referring to the
application for further particulars, shall be published by the
secretary of the authority pursuant to Section 6061, and in the event
the facilities are proposed to be located in a city and the project
is proposed to be undertaken by an authority the jurisdiction of
which is countywide, a copy of the notice shall be mailed by the
secretary of the authority to the governing body of the city. Any
amendment, supplement, or clarification of an application that
changes the company that is the applicant, the description of the
facilities, or the estimated principal amount of the bond issue, as
previously noticed, shall be noticed in the same manner.
   (f) A copy of the application shall be filed with the public
agency. The authority shall not issue bonds with respect to any
project unless the public agency shall approve, conditionally or
unconditionally, the project, including the issuance of bonds
therefor. Action to approve or disapprove a project shall be taken
within 45 days of the filing with the public agency. Certification of
approval or disapproval shall be made by the clerk of the public
agency to the authority. If the governing body has declared itself to
be the board pursuant to Section 91523, the approvals and other
actions required of the authority or the public agency by this
section may be taken and performed on a joint and consolidated basis,
as may be deemed practicable in the discretion of the public agency.

   (g) A resolution of intention may be revoked, amended,
supplemented or clarified by the board, at any time prior to entry
into the project agreements. The project agreements, indenture, bonds
and other proceedings shall be consistent with the resolution of
intention, and shall supersede it except to the extent otherwise
expressed.
  SEC. 105.  Section 91533 of the Government Code is amended to read:

   91533.  Authorities shall undertake projects by entry into project
agreements in substance not inconsistent with the following:
   (a) The company shall comply with (or cause to be complied with)
all legal requirements relating to the project and the operation,
repair, and maintenance of the facilities, including (1) obtaining
any rezonings or variances, building, development, and other permits
and approvals, and licenses and other entitlements for use, without
regard to any exemption for public projects and (2) securing the
issuance of any certificates of need, convenience, and necessity or
other certificates or franchises; and shall provide satisfactory
evidence of compliance.
   (b) The company shall comply with all conditions imposed by the
public agency in its approval of the project pursuant to subdivision
(f) of Section 91530.
   (c) The company shall provide, or cause to be provided by others,
all amounts required for the project and all property relating to the
project that are not to be provided as or by expenditure of bond
proceeds, and in the case of any amounts and property that the
company proposes to cause to be provided by others, as by contract,
grant, subsidy, loan, or other form of assistance, shall provide
satisfactory evidence that those amounts and property will be
provided when required.
   (d) Expenditure of bond proceeds shall be supervised to assure
proper application to the project.
   (e) The company shall at its own expense insure, repair, and
maintain the facilities, pay taxes with respect to its interests in
the property relating to the project as Part 1 (commencing with
Section 101) of Division 1 of the Revenue and Taxation Code requires,
and pay assessments and other public charges secured by liens, upon
those interests as constitute the tax base for property taxation on
the same basis as other property, or shall cause the same to be
provided by others to the satisfaction of the authority.
        (f) The amounts payable pursuant to the project agreements to
or for the benefit of an authority shall in the aggregate not be
less than amounts sufficient (1) to pay any bonds that shall be
issued by the authority to pay the cost of the project, (2) to
maintain any required reserves, (3) to make payments as may be
required into any sinking fund or other similar fund, and (4) to pay
those administration expenses that relate to the administration of
the project agreements, the indenture, and the bonds.
   (g) The term shall extend at least until the date on which all
those bonds and all other obligations incurred by an authority in
connection with a project shall have been paid in full or adequate
funds for that payment shall have been otherwise provided.
   (h) The additional provisions as in the determination of the board
are necessary or appropriate to effectuate the purposes of this
article, including provisions for the following:
   (1) For payments pursuant to the project agreements that include
amounts for administration expenses in addition to the amounts that
the agreement is required to obligate the company or others to pay.
   (2) For payment before a facility exists or becomes functional, or
after a facility has ceased to exist or be functional to any extent
and from any cause.
   (3) For payment whether or not the company is in possession or is
entitled to be in possession of the facilities or for payment in the
event of sale or other transfer of ownership of or the encumbering of
the facilities.
   (4) Relating to the carrying out and completion of the project,
including the allocation of responsibility between the authority and
the company regarding the payment of administrative expenses and
costs of issuance, the acquisition of property, the making of other
purchases, the contracting for construction of the facilities, with
or without competitive bidding, and the payment therefor and the
designation of particular deposits or investments otherwise
authorized for the deposit, investment, and reinvestment of revenues.

   (5) That some or all of the obligations of a company shall be
unconditional and shall be binding and enforceable in all
circumstances whatsoever notwithstanding any other law.
   (6) Relating to the use, maintenance, repair, insurance, and
replacement of property relating to the project, such as the
authority and the company deem necessary for the protection of
themselves or others, including, but not limited to, liability
insurance, and indemnification in the event of default.
   (7) Defining events of default and providing remedies therefor,
which may include an acceleration of future payments thereunder.
   (i) The company shall provide for the payment of relocation
assistance as provided by Chapter 16 (commencing with Section 7260)
of Division 7 of Title 1, and shall reimburse the authority or the
public agency, as the case may be, for relocation assistance
services, and notwithstanding any other provision of this title, the
authority shall determine that those services are provided and that
relocation assistance payments are made.
   (j) Notwithstanding any other provision of this title, projects
undertaken and carried out pursuant to this title shall be consistent
with the requirements of the general plan as contained in Article 5
(commencing with Section 65300) of Chapter 3 of Division 1 of Title 7
at the time of entry into the project agreement, or in the event
inconsistent at that time, then at the time of delivery of any bonds.

   (k) The company may, pursuant to project agreements, provide or
cause to be provided other security, such as, but not limited to, an
agreement of guaranty, either of itself or another person, or other
consideration directly to the bondholders, their agent or the trustee
under an indenture, and neither the company nor any such other
person shall be precluded by the project agreements from having other
contractual relationships with those bondholders or that agent or
trustee.
   (l) Authorities shall require, whether or not authorities,
companies, or others are the contract-awarding bodies, that on any
construction, improvement, reconstruction, or rehabilitation financed
in whole or in part by means of bonds issued pursuant to this title,
the resolution of intention for which is adopted on or after January
1, 1983, all workers employed in that work, exclusive of maintenance
work, shall be paid not less than the general prevailing rate of per
diem wages for work of a similar character in the locality in which
the work is performed, and not less than the general prevailing rate
of per diem wages for holiday and overtime work. Those rates shall be
determined by the Director of Industrial Relations in accordance
with the standards set forth in Section 1773 of the Labor Code. The
director's determination shall be final, and Sections 1773.1, 1773.5,
1774, and 1776 (excepting subdivision (f) of Section 1776) of the
Labor Code shall apply.
  SEC. 106.  Section 86 of the Harbors and Navigation Code is amended
to read:
   86.  (a) The local public agency shall annually certify to the
department that for a small craft harbor or boating facility project
that is, or has been, funded pursuant to Section 70, 70.2, 70.8,
71.4, 72.5, or 76.3, or a harbor constructed with funds from the
State Lands Commission from tidelands oil revenues, adequate restroom
and sanitary facilities, parking, refuse disposal, vessel pumpout
facilities as required pursuant to Section 776, walkways, oil
recycling facilities, receptacles for the purpose of separating,
reusing, or recycling all solid waste materials, and other necessary
shoreside facilities sufficient for the use and operation of all
vessels using the harbor or facility are provided or provide written
findings showing why the facility cannot certify to these conditions.

   (b) A city, county, or district, which has received or is
receiving moneys under this division for the construction or
improvement of small craft harbors that provides facilities for the
operation of commercial fishing vessels registered pursuant to
Article 4 (commencing with Section 7880) of Chapter 1 of Part 3 of
Division 6 of the Fish and Game Code, shall not prohibit the
commercial operation and use of those facilities by commercial
passenger fishing vessels of the same or similar displacement, which
are licensed pursuant to Section 7920 of the Fish and Game Code, or
the use by private recreational vessels unless otherwise expressly
provided by law, unless the city, county, or district provides,
elsewhere in the same harbor, alternative, equivalent facilities
available at comparable cost for the commercial operation and use of
commercial passenger fishing vessels and private recreational vessels
or unless the city, county, or district adopts written findings
showing why the existing facility cannot accommodate the operation of
commercial fishing vessels, including commercial passenger fishing
vessels, or private recreational vessels and why the facility cannot
be modified to do so or why alternative, equivalent facilities cannot
be provided in the same harbor to accommodate those operations. This
subdivision does not require a facility to accept an application for
the operation of an additional commercial passenger fishing boat at
that facility if the harbor provides alternative, equivalent,
adequate, safe facilities at comparable cost for the operation and
use of commercial passenger fishing boats or if accommodations for
the operation of the additional commercial passenger fishing boat are
not reasonably available at the facility under the contract or
agreement.
   For the purposes of this subdivision, an alternative, equivalent
facility in the same harbor shall provide, at comparable cost,
adequate restroom and sanitary facilities, parking, refuse disposal,
vessel pumpout facilities, walkways, oil recycling facilities,
receptacles for the purpose of separating, reusing, or recycling all
solid waste materials, power and water service, and other shoreside
facilities and equivalent docks, water channels, navigation aids, and
weather protection, including, but not limited to, breakwaters,
which are equivalent to the facility funded pursuant to Section 70,
70.2, 70.8, 71.4, 72.5, or 76.3.
   (c) (1) A loan, grant, contract or agreement, or plan funded
pursuant to Section 70, 70.2, 70.8, 71.4, 72.5, or 76.3 for a small
craft harbor or boating facility project shall provide for
construction, development, or improvement of facilities to meet the
provisions of subdivisions (a) and (b), and provide vehicular access
roads to the harbor or facility, as recommended by the Department of
Transportation pursuant to Division 13 (commencing with Section
21000) of the Public Resources Code, unless the reasons for not
meeting those provisions and recommendations are set forth in the
contract or agreement with the department, or an addendum thereto.
   (2) The small craft harbor or boating facility shall be designed,
constructed, developed, improved, and operated to meet, at a minimum,
applicable certification standards described in the Tier 1 standards
of the California Green Building Standards Code (Part 11 of Title 24
of the California Code of Regulations).
   (d) During the term of any existing or new loan contract made
pursuant to Section 71.4 or 76.3, or any existing or new contract or
agreement pursuant to Section 70, 70.2, or 70.8, the department shall
supervise and monitor compliance with this section and the operation
and maintenance of the harbor or facility to assure that the
planning, construction, development, or improvement fully complies
with this section and the contract or agreement terms and conditions.

   (e) For the purposes of this chapter and Article 3 (commencing
with Section 70) of Chapter 2, a harbor or facility that is the
subject of a contract or agreement as described in subdivision (d),
is under the jurisdiction of the department.
  SEC. 107.  Section 652 of the Harbors and Navigation Code is
amended to read:
   652.  (a) The department may issue regulations to do all of the
following:
   (1) Establish minimum safety standards for boats and associated
equipment.
   (2) Require the installation, carrying, or using of associated
equipment.
   (3) Prohibit the installation, carrying, or using of associated
equipment that does not conform with safety standards established
pursuant to this chapter.
   (b) The regulations shall conform with the federal navigation laws
or with the navigation rules promulgated by the United States Coast
Guard, or any successor thereto.
   (c) A person or public agency shall not use or give permission for
the use of a vessel that does not carry the equipment or meet the
standards established pursuant to this chapter.
   (d) A peace officer or harbor police officer authorized to enforce
this chapter may order the termination of the operation of a vessel
that is found to be unsafe for operation pursuant to Section 6550.5
of Title 14 of the California Code of Regulations. A violation of an
order under this subdivision is a misdemeanor.
   (e) A person found guilty of a misdemeanor violation of
subdivision (d), or of any regulation adopted by the department
pursuant to this section, shall be subject to a fine not to exceed
one thousand dollars ($1,000), imprisonment in a county jail not to
exceed six months, or both that fine and imprisonment.
  SEC. 108.  Section 1176 of the Harbors and Navigation Code is
amended to read:
   1176.  (a) The board shall appoint a physician or physicians who
are qualified to determine the suitability of a person to perform his
or her duties as a pilot, an inland pilot, or a pilot trainee in
accordance with subdivision (c).
   (b) An applicant for a pilot trainee position or for a pilot
license, or an existing pilot trainee, a pilot, or an inland pilot
seeking renewal of his or her license shall undergo a physical
examination by a board-appointed physician in accordance with
standards prescribed by the board. Within 30 days prior to the
examination, the applicant or licensee shall submit to the physician
conducting the physical examination a complete list of all prescribed
medications being taken by or administered to the applicant or
licensee.
   (c) On the basis of both the examination and an evaluation of the
effects of the prescription medications named on the submitted list,
the physician shall designate to the board whether or not the pilot,
inland pilot, or pilot trainee is fit to perform his or her duties as
a pilot, an inland pilot, or a pilot trainee.
   (d) The license of a pilot or an inland pilot shall not be renewed
unless he or she is found fit for duty pursuant to subdivision (c).
   (e) Whenever a pilot, an inland pilot, or a pilot trainee is
prescribed either a new dosage of a medication or a new medication,
or suspends the use of a prescribed medication, he or she shall,
within 10 days, submit that information to the board-appointed
physician having possession of the prescribed medication list
submitted pursuant to subdivision (b). Whenever the physician
receives the updated information, the physician shall determine
whether or not the medication change affects the licensee's or
trainee's fitness for duty. If the physician determines that the
medication change results in the pilot, inland pilot, or pilot
trainee being unfit for duty, the physician shall inform the board.
   (f) The board may terminate a pilot trainee or suspend or revoke
the license of a pilot or an inland pilot who fails to submit the
prescribed medication information required by this section.
  SEC. 109.  Section 5864 of the Harbors and Navigation Code is
amended to read:
   5864.  The ballot to be used at the election shall be
substantially in the following form:



      HARBOR DISTRICT


OFFICIAL BALLOT


   Instructions to voters: To vote in favor of the formation of the
harbor district and the incurring of the indebtedness thereby, mark
in the voting area at the right of the words "For the harbor
district."
   To vote against the formation of the harbor district and the
incurring of the indebtedness thereby, mark in the voting area at the
right of the words "Against the harbor district."
   All erasures and distinguishing marks are forbidden and make the
ballot void. If you wrongly stamp, tear, or deface this ballot,
return it to the inspector of elections and obtain another.



   PROPOSITION


   "For the harbor district" (here set forth a general statement of
the purposes for which the indebtedness is to be incurred, and the
amount of the indebtedness).
   "Against the harbor district" (here set forth a general statement
of the purposes for which the indebtedness is to be incurred and the
amount of the indebtedness).
  SEC. 110.  Section 6035 of the Harbors and Navigation Code is
amended to read:
   6035.  The ballot to be used at the election shall be
substantially in the following form:



      (Name) Harbor District Official Ballot



   Instructions to voters: to vote in favor of the formation of the
harbor district, mark in the voting area at the right of the words
"For the harbor district." To vote against the formation of the
harbor district mark in the voting area at the right of the words
"Against the harbor district." To vote for a candidate for harbor
commissioner mark after the name of the candidate; but no more
persons shall be voted for than there are offices of harbor
commissioner to be filled at this election.
   All erasures and distinguishing marks are forbidden and make the
ballot void. If you wrongfully stamp, tear, or deface this ballot,
return it to the inspector of elections and obtain another.
   "For the harbor district."
   "Against the harbor district."
   "For harbor commissioners."

  SEC. 111.  Section 1261.5 of the Health and Safety Code is amended
to read:
   1261.5.  (a) The number of oral dosage form or suppository form
drugs provided by a pharmacy to a health facility licensed pursuant
to subdivision (c) or (d), or both subdivisions (c) and (d), of
Section 1250 of this code for storage in a secured emergency supplies
container, pursuant to Section 4119 of the Business and Professions
Code, shall be limited to 48. The State Department of Public Health
may limit the number of doses of each drug available to not more than
16 doses of any separate drug dosage form in each emergency supply.
   (b) Not more than four of the 48 oral form or suppository form
drugs secured for storage in the emergency supplies container shall
be psychotherapeutic drugs, except that the department may grant a
program flexibility request to the facility to increase the number of
psychotherapeutic drugs in the emergency supplies container to not
more than 10 if the facility can demonstrate the necessity for an
increased number of drugs based on the needs of the patient
population at the facility. In addition, the four oral form or
suppository form psychotherapeutic drug limit shall not apply to a
special treatment program service unit distinct part, as defined in
Section 1276.9. The department shall limit the number of doses of
psychotherapeutic drugs available to not more than four doses in each
emergency supply. Nothing in this section shall alter or diminish
informed consent requirements, including, but not limited to, the
requirements of Section 1418.9.
   (c) Any limitations established pursuant to subdivisions (a) and
(b) on the number and quantity of oral dosage or suppository form
drugs provided by a pharmacy to a health facility licensed pursuant
to subdivision (c) or (d), or both subdivisions (c) and (d), of
Section 1250 for storage in a secured emergency supplies container
shall not apply to an automated drug delivery system, as defined in
Section 1261.6, when a pharmacist controls access to the drugs.
  SEC. 112.  Section 1289.4 of the Health and Safety Code is amended
to read:
   1289.4.  A theft and loss program shall be implemented by the
long-term health care facilities within 90 days after January 1,
1988. The program shall include all of the following:
   (a) Establishment and posting of the facility's policy regarding
theft and investigative procedures.
   (b) Orientation to the policies and procedures for all employees
within 90 days of employment.
   (c) Documentation of lost and stolen patient property with a value
of twenty-five dollars ($25) or more and, upon request, the
documented theft and loss record for the past 12 months shall be made
available to the State Department of Public Health, the county
health department or law enforcement agencies, and to the office of
the State Long-Term Care Ombudsman in response to a specific
complaint. The documentation shall include, but not be limited to,
the following:
   (1) A description of the article.
   (2) Its estimated value.
   (3) The date and time the theft or loss was discovered.
   (4) If determinable, the date and time the loss or theft occurred.

   (5) The action taken.
   (d) A written patient personal property inventory is established
upon admission and retained during the resident's stay in the
long-term health care facility. A copy of the written inventory shall
be provided to the resident or the person acting on the resident's
behalf. Subsequent items brought into or removed from the facility
shall be added to or deleted from the personal property inventory by
the facility at the written request of the resident, the resident's
family, a responsible party, or a person acting on behalf of a
resident. The facility shall not be liable for items which have not
been requested to be included in the inventory or for items which
have been deleted from the inventory. A copy of a current inventory
shall be made available upon request to the resident, responsible
party, or other authorized representative. The resident, resident's
family, or a responsible party may list those items that are not
subject to addition or deletion from the inventory, such as personal
clothing or laundry, that are subject to frequent removal from the
facility.
   (e) Inventory and surrender of the resident's personal effects and
valuables upon discharge to the resident or authorized
representative in exchange for a signed receipt.
   (f) Inventory and surrender of personal effects and valuables
following the death of a resident to the authorized representative in
exchange for a signed receipt. Immediate notice to the public
administrator of the county upon the death of a resident without
known next of kin as provided in Section 7600.5 of the Probate Code.
   (g) Documentation, at least semiannually, of the facility's
efforts to control theft and loss, including the review of theft and
loss documentation and investigative procedures and results of the
investigation by the administrator and, when feasible, the resident
council.
   (h) Establishment of a method of marking, to the extent feasible,
personal property items for identification purposes upon admission
and, as added to the property inventory list, including engraving of
dentures and tagging of other prosthetic devices.
   (i) Reports to the local law enforcement agency within 36 hours
when the administrator of the facility has reason to believe patient
property with a then-current value of one hundred dollars ($100) or
more has been stolen. Copies of those reports for the preceding 12
months shall be made available to the State Department of Public
Health and law enforcement agencies.
   (j) Maintenance of a secured area for patients' property which is
available for safekeeping of patient property upon the request of the
patient or the patient's responsible party. Provide a lock for the
resident's bedside drawer or cabinet upon request of and at the
expense of the resident, the resident's family, or authorized
representative. The facility administrator shall have access to the
locked areas upon request.
   (k) A copy of this section and Sections 1289.3 and 1289.5 is
provided by a facility to all of the residents and their responsible
parties, and, available upon request, to all of the facility's
prospective residents and their responsible parties.
   (l) Notification to all current residents and all new residents,
upon admission, of the facility's policies and procedures relating to
the facility's theft and loss prevention program.
  SEC. 113.  Section 1348.8 of the Health and Safety Code is amended
to read:
   1348.8.  (a) A health care service plan that provides, operates,
or contracts for telephone medical advice services to its enrollees
and subscribers shall do all of the following:
   (1) Ensure that the in-state or out-of-state telephone medical
advice service is registered pursuant to Chapter 15 (commencing with
Section 4999) of Division 2 of the Business and Professions Code.
   (2) Ensure that the staff providing telephone medical advice
services for the in-state or out-of-state telephone medical advice
service are licensed as follows:
   (A) For full service health care service plans, the staff hold a
valid California license as a registered nurse or a valid license in
the state within which they provide telephone medical advice services
as a physician and surgeon or physician assistant, and are operating
in compliance with the laws governing their respective scopes of
practice.
   (B) (i) For specialized health care service plans providing,
operating, or contracting with a telephone medical advice service in
California, the staff shall be appropriately licensed, registered, or
certified as a dentist pursuant to Chapter 4 (commencing with
Section 1600) of Division 2 of the Business and Professions Code, as
a dental hygienist pursuant to Article 7 (commencing with Section
1740) of Chapter 4 of Division 2 of the Business and Professions
Code, as a physician and surgeon pursuant to Chapter 5 (commencing
with Section 2000) of Division 2 of the Business and Professions Code
or the Osteopathic Initiative Act, as a registered nurse pursuant to
Chapter 6 (commencing with Section 2700) of Division 2 of the
Business and Professions Code, as a psychologist pursuant to Chapter
6.6 (commencing with Section 2900) of Division 2 of the Business and
Professions Code, as an optometrist pursuant to Chapter 7 (commencing
with Section 3000) of Division 2 of the Business and Professions
Code, as a marriage and family therapist pursuant to Chapter 13
(commencing with Section 4980) of Division 2 of the Business and
Professions Code, as a licensed clinical social worker pursuant to
Chapter 14 (commencing with Section 4991) of Division 2 of the
Business and Professions Code, or as a chiropractor pursuant to the
Chiropractic Initiative Act, and operating in compliance with the
laws governing their respective scopes of practice.
   (ii) For specialized health care service plans providing,
operating, or contracting with an out-of-state telephone medical
advice service, the staff shall be health care professionals, as
identified in clause (i), who are licensed, registered, or certified
in the state within which they are providing the telephone medical
advice services and are operating in compliance with the laws
governing their respective scopes of practice. All registered nurses
providing telephone medical advice services to both in-state and
out-of-state business entities registered pursuant to this chapter
shall be licensed pursuant to Chapter 6 (commencing with Section
2700) of Division 2 of the Business and Professions Code.
   (3) Ensure that every full service health care service plan
provides for a physician and surgeon who is available on an on-call
basis at all times the service is advertised to be available to
enrollees and subscribers.
   (4) Ensure that staff members handling enrollee or subscriber
calls, who are not licensed, certified, or registered as required by
paragraph (2), do not provide telephone medical advice. Those staff
members may ask questions on behalf of a staff member who is
licensed, certified, or registered as required by paragraph (2), in
order to help ascertain the condition of an enrollee or subscriber so
that the enrollee or subscriber can be referred to licensed staff.
However, under no circumstances shall those staff members use the
answers to those questions in an attempt to assess, evaluate, advise,
or make any decision regarding the condition of an enrollee or
subscriber or determine when an enrollee or subscriber needs to be
seen by a licensed medical professional.
   (5) Ensure that no staff member uses a title or designation when
speaking to an enrollee or subscriber that may cause a reasonable
person to believe that the staff member is a licensed, certified, or
registered professional described in Section 4999.2 of the Business
and Professions Code unless the staff member is a licensed,
                                   certified, or registered
professional.
   (6) Ensure that the in-state or out-of-state telephone medical
advice service designates an agent for service of process in
California and files this designation with the director.
   (7) Requires that the in-state or out-of-state telephone medical
advice service makes and maintains records for a period of five years
after the telephone medical advice services are provided, including,
but not limited to, oral or written transcripts of all medical
advice conversations with the health care service plan's enrollees or
subscribers in California and copies of all complaints. If the
records of telephone medical advice services are kept out of state,
the health care service plan shall, upon the request of the director,
provide the records to the director within 10 days of the request.
   (8) Ensure that the telephone medical advice services are provided
consistent with good professional practice.
   (b) The director shall forward to the Department of Consumer
Affairs, within 30 days of the end of each calendar quarter, data
regarding complaints filed with the department concerning telephone
medical advice services.
   (c) For purposes of this section, "telephone medical advice" means
a telephonic communication between a patient and a health care
professional in which the health care professional's primary function
is to provide to the patient a telephonic response to the patient's
questions regarding his or her or a family member's medical care or
treatment. "Telephone medical advice" includes assessment,
evaluation, or advice provided to patients or their family members.
  SEC. 114.  Section 1357 of the Health and Safety Code is amended to
read:
   1357.  As used in this article:
   (a) "Dependent" means the spouse or child of an eligible employee,
subject to applicable terms of the health care plan contract
covering the employee, and includes dependents of guaranteed
association members if the association elects to include dependents
under its health coverage at the same time it determines its
membership composition pursuant to subdivision (o).
   (b) "Eligible employee" means either of the following:
   (1) Any permanent employee who is actively engaged on a full-time
basis in the conduct of the business of the small employer with a
normal workweek of at least 30 hours, at the small employer's regular
places of business, who has met any statutorily authorized
applicable waiting period requirements. The term includes sole
proprietors or partners of a partnership, if they are actively
engaged on a full-time basis in the small employer's business and
included as employees under a health care plan contract of a small
employer, but does not include employees who work on a part-time,
temporary, or substitute basis. It includes any eligible employee, as
defined in this paragraph, who obtains coverage through a guaranteed
association. Employees of employers purchasing through a guaranteed
association shall be deemed to be eligible employees if they would
otherwise meet the definition except for the number of persons
employed by the employer. Permanent employees who work at least 20
hours but not more than 29 hours are deemed to be eligible employees
if all four of the following apply:
   (A) They otherwise meet the definition of an eligible employee
except for the number of hours worked.
   (B) The employer offers the employees health coverage under a
health benefit plan.
   (C) All similarly situated individuals are offered coverage under
the health benefit plan.
   (D) The employee must have worked at least 20 hours per normal
workweek for at least 50 percent of the weeks in the previous
calendar quarter. The health care service plan may request any
necessary information to document the hours and time period in
question, including, but not limited to, payroll records and employee
wage and tax filings.
   (2) Any member of a guaranteed association as defined in
subdivision (o).
   (c) "In force business" means an existing health benefit plan
contract issued by the plan to a small employer.
   (d) "Late enrollee" means an eligible employee or dependent who
has declined enrollment in a health benefit plan offered by a small
employer at the time of the initial enrollment period provided under
the terms of the health benefit plan and who subsequently requests
enrollment in a health benefit plan of that small employer, provided
that the initial enrollment period shall be a period of at least 30
days. It also means any member of an association that is a guaranteed
association as well as any other person eligible to purchase through
the guaranteed association when that person has failed to purchase
coverage during the initial enrollment period provided under the
terms of the guaranteed association's plan contract and who
subsequently requests enrollment in the plan, provided that the
initial enrollment period shall be a period of at least 30 days.
However, an eligible employee, any other person eligible for coverage
through a guaranteed association pursuant to subdivision (o), or an
eligible dependent shall not be considered a late enrollee if any of
the following is applicable:
   (1) The individual meets all of the following requirements:
   (A) He or she was covered under another employer health benefit
plan, the Healthy Families Program, the Access for Infants and
Mothers (AIM) Program, or the Medi-Cal program at the time the
individual was eligible to enroll.
   (B) He or she certified at the time of the initial enrollment that
coverage under another employer health benefit plan, the Healthy
Families Program, the AIM Program, or the Medi-Cal program was the
reason for declining enrollment, provided that, if the individual was
covered under another employer health plan, the individual was given
the opportunity to make the certification required by this
subdivision and was notified that failure to do so could result in
later treatment as a late enrollee.
   (C) He or she has lost or will lose coverage under another
employer health benefit plan as a result of termination of employment
of the individual or of a person through whom the individual was
covered as a dependent, change in employment status of the individual
or of a person through whom the individual was covered as a
dependent, termination of the other plan's coverage, cessation of an
employer's contribution toward an employee or dependent's coverage,
death of the person through whom the individual was covered as a
dependent, legal separation, or divorce; or he or she has lost or
will lose coverage under the Healthy Families Program, the AIM
Program, or the Medi-Cal program.
   (D) He or she requests enrollment within 30 days after termination
of coverage or employer contribution toward coverage provided under
another employer health benefit plan, or requests enrollment within
60 days after termination of Medi-Cal program coverage, AIM Program
coverage, or Healthy Families Program coverage.
   (2) The employer offers multiple health benefit plans and the
employee elects a different plan during an open enrollment period.
   (3) A court has ordered that coverage be provided for a spouse or
minor child under a covered employee's health benefit plan.
   (4) (A) In the case of an eligible employee, as defined in
paragraph (1) of subdivision (b), the plan cannot produce a written
statement from the employer stating that the individual or the person
through whom the individual was eligible to be covered as a
dependent, prior to declining coverage, was provided with, and
signed, acknowledgment of an explicit written notice in boldface type
specifying that failure to elect coverage during the initial
enrollment period permits the plan to impose, at the time of the
individual's later decision to elect coverage, an exclusion from
coverage for a period of 12 months as well as a six-month preexisting
condition exclusion, unless the individual meets the criteria
specified in paragraph (1), (2), or (3).
   (B) In the case of an association member who did not purchase
coverage through a guaranteed association, the plan cannot produce a
written statement from the association stating that the association
sent a written notice in boldface type to all potentially eligible
association members at their last known address prior to the initial
enrollment period informing members that failure to elect coverage
during the initial enrollment period permits the plan to impose, at
the time of the member's later decision to elect coverage, an
exclusion from coverage for a period of 12 months as well as a
six-month preexisting condition exclusion unless the member can
demonstrate that he or she meets the requirements of subparagraphs
(A), (C), and (D) of paragraph (1) or meets the requirements of
paragraph (2) or (3).
   (C) In the case of an employer or person who is not a member of an
association, was eligible to purchase coverage through a guaranteed
association, and did not do so, and would not be eligible to purchase
guaranteed coverage unless purchased through a guaranteed
association, the employer or person can demonstrate that he or she
meets the requirements of subparagraphs (A), (C), and (D) of
paragraph (1), or meets the requirements of paragraph (2) or (3), or
that he or she recently had a change in status that would make him or
her eligible and that application for enrollment was made within 30
days of the change.
   (5) The individual is an employee or dependent who meets the
criteria described in paragraph (1) and was under a COBRA
continuation provision and the coverage under that provision has been
exhausted. For purposes of this section, the definition of "COBRA"
set forth in subdivision (e) of Section 1373.621 shall apply.
   (6) The individual is a dependent of an enrolled eligible employee
who has lost or will lose his or her coverage under the Healthy
Families Program, the AIM Program, or the Medi-Cal program and
requests enrollment within 60 days after termination of that
coverage.
   (7) The individual is an eligible employee who previously declined
coverage under an employer health benefit plan and who has
subsequently acquired a dependent who would be eligible for coverage
as a dependent of the employee through marriage, birth, adoption, or
placement for adoption, and who enrolls for coverage under that
employer health benefit plan on his or her behalf and on behalf of
his or her dependent within 30 days following the date of marriage,
birth, adoption, or placement for adoption, in which case the
effective date of coverage shall be the first day of the month
following the date the completed request for enrollment is received
in the case of marriage, or the date of birth, or the date of
adoption or placement for adoption, whichever applies. Notice of the
special enrollment rights contained in this paragraph shall be
provided by the employer to an employee at or before the time the
employee is offered an opportunity to enroll in plan coverage.
   (8) The individual is an eligible employee who has declined
coverage for himself or herself or his or her dependents during a
previous enrollment period because his or her dependents were covered
by another employer health benefit plan at the time of the previous
enrollment period. That individual may enroll himself or herself or
his or her dependents for plan coverage during a special open
enrollment opportunity if his or her dependents have lost or will
lose coverage under that other employer health benefit plan. The
special open enrollment opportunity shall be requested by the
employee not more than 30 days after the date that the other health
coverage is exhausted or terminated. Upon enrollment, coverage shall
be effective not later than the first day of the first calendar month
beginning after the date the request for enrollment is received.
Notice of the special enrollment rights contained in this paragraph
shall be provided by the employer to an employee at or before the
time the employee is offered an opportunity to enroll in plan
coverage.
   (e) "New business" means a health care service plan contract
issued to a small employer that is not the plan's in force business.
   (f) "Preexisting condition provision" means a contract provision
that excludes coverage for charges or expenses incurred during a
specified period following the employee's effective date of coverage,
as to a condition for which medical advice, diagnosis, care, or
treatment was recommended or received during a specified period
immediately preceding the effective date of coverage.
   (g) "Creditable coverage" means:
   (1) Any individual or group policy, contract, or program that is
written or administered by a disability insurer, health care service
plan, fraternal benefits society, self-insured employer plan, or any
other entity, in this state or elsewhere, and that arranges or
provides medical, hospital, and surgical coverage not designed to
supplement other private or governmental plans. The term includes
continuation or conversion coverage but does not include accident
only, credit, coverage for onsite medical clinics, disability income,
Medicare supplement, long-term care, dental, vision, coverage issued
as a supplement to liability insurance, insurance arising out of a
workers' compensation or similar law, automobile medical payment
insurance, or insurance under which benefits are payable with or
without regard to fault and that is statutorily required to be
contained in any liability insurance policy or equivalent
self-insurance.
   (2) The Medicare Program pursuant to Title XVIII of the federal
Social Security Act (42 U.S.C. Sec. 1395 et seq.).
   (3) The Medicaid Program pursuant to Title XIX of the federal
Social Security Act (42 U.S.C. Sec. 1396 et seq.).
   (4) Any other publicly sponsored program, provided in this state
or elsewhere, of medical, hospital, and surgical care.
   (5) 10 U.S.C. Chapter 55 (commencing with Section 1071) (Civilian
Health and Medical Program of the Uniformed Services (CHAMPUS)).
   (6) A medical care program of the Indian Health Service or of a
tribal organization.
   (7) A state health benefits risk pool.
   (8) A health plan offered under 5 U.S.C. Chapter 89 (commencing
with Section 8901) (Federal Employees Health Benefits Program
(FEHBP)).
   (9) A public health plan as defined in federal regulations
authorized by Section 2701(c)(1)(I) of the Public Health Service Act,
as amended by Public Law 104-191, the Health Insurance Portability
and Accountability Act of 1996.
   (10) A health benefit plan under Section 5(e) of the Peace Corps
Act (22 U.S.C. Sec. 2504(e)).
   (11) Any other creditable coverage as defined by subdivision (c)
of Section 2701 of Title XXVII of the federal Public Health Services
Act (42 U.S.C. Sec. 300gg(c)).
   (h) "Rating period" means the period for which premium rates
established by a plan are in effect and shall be no less than six
months.
   (i) "Risk adjusted employee risk rate" means the rate determined
for an eligible employee of a small employer in a particular risk
category after applying the risk adjustment factor.
   (j) "Risk adjustment factor" means the percentage adjustment to be
applied equally to each standard employee risk rate for a particular
small employer, based upon any expected deviations from standard
cost of services. This factor may not be more than 120 percent or
less than 80 percent until July 1, 1996. Effective July 1, 1996, this
factor may not be more than 110 percent or less than 90 percent.
   (k) "Risk category" means the following characteristics of an
eligible employee: age, geographic region, and family composition of
the employee, plus the health benefit plan selected by the small
employer.
   (1) No more than the following age categories may be used in
determining premium rates:
   Under 30
   30-39
   40-49
   50-54
   55-59
   60-64
   65 and over
   However, for the 65 and over age category, separate premium rates
may be specified depending upon whether coverage under the plan
contract will be primary or secondary to benefits provided by the
Medicare Program pursuant to Title XVIII of the federal Social
Security Act (42 U.S.C. Sec. 1395 et seq.).
   (2) Small employer health care service plans shall base rates to
small employers using no more than the following family size
categories:
   (A) Single.
   (B) Married couple.
   (C) One adult and child or children.
   (D) Married couple and child or children.
   (3) (A) In determining rates for small employers, a plan that
operates statewide shall use no more than nine geographic regions in
the state, have no region smaller than an area in which the first
three digits of all its ZIP Codes are in common within a county, and
divide no county into more than two regions. Plans shall be deemed to
be operating statewide if their coverage area includes 90 percent or
more of the state's population. Geographic regions established
pursuant to this section shall, as a group, cover the entire state,
and the area encompassed in a geographic region shall be separate and
distinct from areas encompassed in other geographic regions.
Geographic regions may be noncontiguous.
   (B) (i) In determining rates for small employers, a plan that does
not operate statewide shall use no more than the number of
geographic regions in the state that is determined by the following
formula: the population, as determined in the last federal census, of
all counties that are included in their entirety in a plan's service
area divided by the total population of the state, as determined in
the last federal census, multiplied by nine. The resulting number
shall be rounded to the nearest whole integer. No region may be
smaller than an area in which the first three digits of all its ZIP
Codes are in common within a county and no county may be divided into
more than two regions. The area encompassed in a geographic region
shall be separate and distinct from areas encompassed in other
geographic regions. Geographic regions may be noncontiguous. No plan
shall have less than one geographic area.
   (ii) If the formula in clause (i) results in a plan that operates
in more than one county having only one geographic region, then the
formula in clause (i) shall not apply and the plan may have two
geographic regions, provided that no county is divided into more than
one region.
   Nothing in this section shall be construed to require a plan to
establish a new service area or to offer health coverage on a
statewide basis, outside of the plan's existing service area.
   (l) "Small employer" means either of the following:
   (1) Any person, firm, proprietary or nonprofit corporation,
partnership, public agency, or association that is actively engaged
in business or service, that, on at least 50 percent of its working
days during the preceding calendar quarter or preceding calendar
year, employed at least two, but no more than 50, eligible employees,
the majority of whom were employed within this state, that was not
formed primarily for purposes of buying health care service plan
contracts, and in which a bona fide employer-employee relationship
exists. In determining whether to apply the calendar quarter or
calendar year test, a health care service plan shall use the test
that ensures eligibility if only one test would establish
eligibility. However, for purposes of subdivisions (a), (b), and (c)
of Section 1357.03, the definition shall include employers with at
least three eligible employees until July 1, 1997, and two eligible
employees thereafter. In determining the number of eligible
employees, companies that are affiliated companies and that are
eligible to file a combined tax return for purposes of state taxation
shall be considered one employer. Subsequent to the issuance of a
health care service plan contract to a small employer pursuant to
this article, and for the purpose of determining eligibility, the
size of a small employer shall be determined annually. Except as
otherwise specifically provided in this article, provisions of this
article that apply to a small employer shall continue to apply until
the plan contract anniversary following the date the employer no
longer meets the requirements of this definition. It includes any
small employer as defined in this paragraph who purchases coverage
through a guaranteed association, and any employer purchasing
coverage for employees through a guaranteed association.
   (2) Any guaranteed association, as defined in subdivision (n),
that purchases health coverage for members of the association.
   (m) "Standard employee risk rate" means the rate applicable to an
eligible employee in a particular risk category in a small employer
group.
   (n) "Guaranteed association" means a nonprofit organization
comprised of a group of individuals or employers who associate based
solely on participation in a specified profession or industry,
accepting for membership any individual or employer meeting its
membership criteria, and that (1) includes one or more small
employers as defined in paragraph (1) of subdivision (l), (2) does
not condition membership directly or indirectly on the health or
claims history of any person, (3) uses membership dues solely for and
in consideration of the membership and membership benefits, except
that the amount of the dues shall not depend on whether the member
applies for or purchases insurance offered to the association, (4) is
organized and maintained in good faith for purposes unrelated to
insurance, (5) has been in active existence on January 1, 1992, and
for at least five years prior to that date, (6) has included health
insurance as a membership benefit for at least five years prior to
January 1, 1992, (7) has a constitution and bylaws, or other
analogous governing documents that provide for election of the
governing board of the association by its members, (8) offers any
plan contract that is purchased to all individual members and
employer members in this state, (9) includes any member choosing to
enroll in the plan contracts offered to the association provided that
the member has agreed to make the required premium payments, and
(10) covers at least 1,000 persons with the health care service plan
with which it contracts. The requirement of 1,000 persons may be met
if component chapters of a statewide association contracting
separately with the same carrier cover at least 1,000 persons in the
aggregate.
   This subdivision applies regardless of whether a contract issued
by a plan is with an association, or a trust formed for or sponsored
by an association, to administer benefits for association members.
   For purposes of this subdivision, an association formed by a
merger of two or more associations after January 1, 1992, and
otherwise meeting the criteria of this subdivision shall be deemed to
have been in active existence on January 1, 1992, if its predecessor
organizations had been in active existence on January 1, 1992, and
for at least five years prior to that date and otherwise met the
criteria of this subdivision.
   (o) "Members of a guaranteed association" means any individual or
employer meeting the association's membership criteria if that person
is a member of the association and chooses to purchase health
coverage through the association. At the association's discretion, it
also may include employees of association members, association
staff, retired members, retired employees of members, and surviving
spouses and dependents of deceased members. However, if an
association chooses to include these persons as members of the
guaranteed association, the association shall make that election in
advance of purchasing a plan contract. Health care service plans may
require an association to adhere to the membership composition it
selects for up to 12 months.
   (p) "Affiliation period" means a period that, under the terms of
the health care service plan contract, must expire before health care
services under the contract become effective.
  SEC. 115.  Section 1357.50 of the Health and Safety Code is amended
to read:
   1357.50.  For purposes of this article:
   (a) "Health benefit plan" means any individual or group insurance
policy or health care service plan contract that provides medical,
hospital, and surgical benefits. The term does not include accident
only, credit, disability income, coverage of Medicare services
pursuant to contracts with the United States government, Medicare
supplement, long-term care insurance, dental, vision, coverage issued
as a supplement to liability insurance, insurance arising out of a
workers' compensation or similar law, automobile medical payment
insurance, or insurance under which benefits are payable with or
without regard to fault and that is statutorily required to be
contained in any liability insurance policy or equivalent
self-insurance.
   (b) "Late enrollee" means an eligible employee or dependent who
has declined health coverage under a health benefit plan offered
through employment or sponsored by an employer at the time of the
initial enrollment period provided under the terms of the health
benefit plan, and who subsequently requests enrollment in a health
benefit plan of that employer, provided that the initial enrollment
period shall be a period of at least 30 days. However, an eligible
employee or dependent shall not be considered a late enrollee if any
of the following is applicable:
   (1) The individual meets all of the following requirements:
   (A) The individual was covered under another employer health
benefit plan, the Healthy Families Program, the Access for Infants
and Mothers (AIM) Program, or the Medi-Cal program at the time the
individual was eligible to enroll.
   (B) The individual certified, at the time of the initial
enrollment, that coverage under another employer health benefit plan,
the Healthy Families Program, the AIM Program, or the Medi-Cal
program was the reason for declining enrollment provided that, if the
individual was covered under another employer health benefit plan,
the individual was given the opportunity to make the certification
required by this subdivision and was notified that failure to do so
could result in later treatment as a late enrollee.
   (C) The individual has lost or will lose coverage under another
employer health benefit plan as a result of termination of employment
of the individual or of a person through whom the individual was
covered as a dependent, change in employment status of the individual
or of a person through whom the individual was covered as a
dependent, termination of the other plan's coverage, cessation of an
employer's contribution toward an employee or dependent's coverage,
death of a person through whom the individual was covered as a
dependent, legal separation, or divorce; or the individual
                               has lost or will lose coverage under
the Healthy Families Program, the AIM Program, or the Medi-Cal
program.
   (D) The individual requests enrollment within 30 days after
termination of coverage, or cessation of employer contribution toward
coverage provided under another employer health benefit plan, or
requests enrollment within 60 days after termination of Medi-Cal
program coverage, AIM Program coverage, or Healthy Families Program
coverage.
   (2) The individual is employed by an employer that offers multiple
health benefit plans and the individual elects a different plan
during an open enrollment period.
   (3) A court has ordered that coverage be provided for a spouse or
minor child under a covered employee's health benefit plan. The
health benefit plan shall enroll a dependent child within 30 days
after receipt of a court order or request from the district attorney,
either parent or the person having custody of the child as defined
in Section 3751.5 of the Family Code, the employer, or the group
administrator. In the case of children who are eligible for Medicaid,
the State Department of Health Care Services may also make the
request.
   (4) The plan cannot produce a written statement from the employer
stating that, prior to declining coverage, the individual or the
person through whom the individual was eligible to be covered as a
dependent was provided with, and signed acknowledgment of, explicit
written notice in boldface type specifying that failure to elect
coverage during the initial enrollment period permits the plan to
impose, at the time of the individual's later decision to elect
coverage, an exclusion from coverage for a period of 12 months as
well as a six-month preexisting condition exclusion, unless the
individual meets the criteria specified in paragraph (1), (2), or
(3).
   (5) The individual is an employee or dependent who meets the
criteria described in paragraph (1) and was under a COBRA
continuation provision, and the coverage under that provision has
been exhausted. For purposes of this section, the definition of
"COBRA" set forth in subdivision (e) of Section 1373.621 shall apply.

   (6) The individual is a dependent of an enrolled eligible employee
who has lost or will lose his or her coverage under the Healthy
Families Program, the AIM Program, or the Medi-Cal program and
requests enrollment within 60 days of termination of that coverage.
   (7) The individual is an eligible employee who previously declined
coverage under an employer health benefit plan and who has
subsequently acquired a dependent who would be eligible for coverage
as a dependent of the employee through marriage, birth, adoption, or
placement for adoption, and who enrolls for coverage under that
employer health benefit plan on his or her behalf, and on behalf of
his or her dependent within 30 days following the date of marriage,
birth, adoption, or placement for adoption, in which case the
effective date of coverage shall be the first day of the month
following the date the completed request for enrollment is received
in the case of marriage, or the date of birth, or the date of
adoption or placement for adoption, whichever applies. Notice of the
special enrollment rights contained in this paragraph shall be
provided by the employer to an employee at or before the time the
employee is offered an opportunity to enroll in plan coverage.
   (8) The individual is an eligible employee who has declined
coverage for himself or herself or his or her dependents during a
previous enrollment period because his or her dependents were covered
by another employer health benefit plan at the time of the previous
enrollment period. That individual may enroll himself or herself or
his or her dependents for plan coverage during a special open
enrollment opportunity if his or her dependents have lost or will
lose coverage under that other employer health benefit plan. The
special open enrollment opportunity shall be requested by the
employee not more than 30 days after the date that the other health
coverage is exhausted or terminated. Upon enrollment, coverage shall
be effective not later than the first day of the first calendar month
beginning after the date the request for enrollment is received.
Notice of the special enrollment rights contained in this paragraph
shall be provided by the employer to an employee at or before the
time the employee is offered an opportunity to enroll in plan
coverage.
   (c) "Preexisting condition provision" means a contract provision
that excludes coverage for charges or expenses incurred during a
specified period following the enrollee's effective date of coverage,
as to a condition for which medical advice, diagnosis, care, or
treatment was recommended or received during a specified period
immediately preceding the effective date of coverage.
   (d) "Creditable coverage" means:
   (1) Any individual or group policy, contract, or program that is
written or administered by a disability insurance company, nonprofit
hospital service plan, health care service plan, fraternal benefits
society, self-insured employer plan, or any other entity, in this
state or elsewhere, and that arranges or provides medical, hospital
and surgical coverage not designed to supplement other private or
governmental plans. The term includes continuation or conversion
coverage but does not include accident only, credit, coverage for
onsite medical clinics, disability income, Medicare supplement,
long-term care insurance, dental, vision, coverage issued as a
supplement to liability insurance, insurance arising out of a workers'
compensation or similar law, automobile medical payment insurance,
or insurance under which benefits are payable with or without regard
to fault and that is statutorily required to be contained in any
liability insurance policy or equivalent self-insurance.
   (2) The Medicare Program pursuant to Title XVIII of the federal
Social Security Act (42 U.S.C. Sec. 1395 et seq.).
   (3) The Medicaid Program pursuant to Title XIX of the federal
Social Security Act (42 U.S.C. Sec. 1396 et seq.).
   (4) Any other publicly sponsored program, provided in this state
or elsewhere, of medical, hospital, and surgical care.
   (5) 10 U.S.C. Chapter 55 (commencing with Section 1071) (Civilian
Health and Medical Program of the Uniformed Services (CHAMPUS)).
   (6) A medical care program of the Indian Health Service or of a
tribal organization.
   (7) A state health benefits risk pool.
   (8) A health plan offered under 5 U.S.C. Chapter 89 (commencing
with Section 8901) (Federal Employees Health Benefits Program
(FEHBP)).
   (9) A public health plan as defined in federal regulations
authorized by Section 2701(c)(1)(I) of the Public Health Service Act,
as amended by Public Law 104-191, the Health Insurance Portability
and Accountability Act of 1996.
   (10) A health benefit plan under Section 5(e) of the Peace Corps
Act (22 U.S.C. Sec. 2504(e)).
   (11) Any other creditable coverage as defined by subdivision (c)
of Section 2701 of Title XXVII of the federal Public Health Service
Act (42 U.S.C. Sec. 300gg(c)).
   (e) "Waivered condition" means a contract provision that excludes
coverage for charges or expenses incurred during a specified period
of time for one or more specific, identified, medical conditions.
   (f) "Affiliation period" means a period that, under the terms of
the health benefit plan, must expire before health care services
under the plan become effective.
  SEC. 116.  Section 1358.4 of the Health and Safety Code is amended
to read:
   1358.4.  The following definitions apply for the purposes of this
article:
   (a) "Applicant" means:
   (1) An individual enrollee who seeks to contract for health
coverage, in the case of an individual Medicare supplement contract.
   (2) An enrollee who seeks to obtain health coverage through a
group, in the case of a group Medicare supplement contract.
   (b) "Bankruptcy" means that situation in which a Medicare
Advantage organization that is not an issuer has filed, or has had
filed against it, a petition for declaration of bankruptcy and has
ceased doing business in the state.
   (c) "Continuous period of creditable coverage" means the period
during which an individual was covered by creditable coverage, if
during the period of the coverage the individual had no breaks in
coverage greater than 63 days.
   (d) (1) "Creditable coverage" means, with respect to an
individual, coverage of the individual provided under any of the
following:
   (A) Any individual or group contract, policy, certificate, or
program that is written or administered by a health care service
plan, health insurer, fraternal benefits society, self-insured
employer plan, or any other entity, in this state or elsewhere, and
that arranges or provides medical, hospital, and surgical coverage
not designed to supplement other private or governmental plans. The
term includes continuation or conversion coverage.
   (B) Part A or B of Title XVIII of the federal Social Security Act
(42 U.S.C. Sec. 1395c et seq.) (Medicare).
   (C) Title XIX of the federal Social Security Act (42 U.S.C. Sec.
1396 et seq.) (Medicaid), other than coverage consisting solely of
benefits under Section 1928 of that act.
   (D) Chapter 55 of Title 10 of the United States Code (CHAMPUS).
   (E) A medical care program of the Indian Health Service or of a
tribal organization.
   (F) A state health benefits risk pool.
   (G) A health plan offered under Chapter 89 of Title 5 of the
United States Code (Federal Employees Health Benefits Program).
   (H) A public health plan as defined in federal regulations
authorized by Section 2701(c)(1)(I) of the federal Public Health
Service Act, as amended by Public Law 104-191, the federal Health
Insurance Portability and Accountability Act of 1996.
   (I) A health benefit plan under Section 5(e) of the federal Peace
Corps Act (22 U.S.C. Sec. 2504(e)).
   (J) Any other publicly sponsored program, provided in this state
or elsewhere, of medical, hospital, and surgical care.
   (K) Any other creditable coverage as defined by subsection (c) of
Section 2701 of Title XXVII of the federal Public Health Service Act
(42 U.S.C. Sec. 300gg(c)).
   (2) "Creditable coverage" shall not include one or more, or any
combination of, the following:
   (A) Coverage for accident-only or disability income insurance, or
any combination thereof.
   (B) Coverage issued as a supplement to liability insurance.
   (C) Liability insurance, including general liability insurance and
automobile liability insurance.
   (D) Workers' compensation or similar insurance.
   (E) Automobile medical payment insurance.
   (F) Credit-only insurance.
   (G) Coverage for onsite medical clinics.
   (H) Other similar insurance coverage, specified in federal
regulations, under which benefits for medical care are secondary or
incidental to other insurance benefits.
   (3) "Creditable coverage" shall not include the following benefits
if they are provided under a separate policy, certificate, or
contract or are otherwise not an integral part of the plan:
   (A) Limited scope dental or vision benefits.
   (B) Benefits for long-term care, nursing home care, home health
care, community-based care, or any combination thereof.
   (C) Other similar, limited benefits as are specified in federal
regulations.
   (4) "Creditable coverage" shall not include the following benefits
if offered as independent, noncoordinated benefits:
   (A) Coverage only for a specified disease or illness.
   (B) Hospital indemnity or other fixed indemnity insurance.
   (5) "Creditable coverage" shall not include the following if
offered as a separate policy, certificate, or contract:
   (A) Medicare supplemental health insurance as defined under
Section 1882(g)(1) of the federal Social Security Act.
   (B) Coverage supplemental to the coverage provided under Chapter
55 of Title 10 of the United States Code.
   (C) Similar supplemental coverage provided to coverage under a
group health plan.
   (e) "Employee welfare benefit plan" means a plan, fund, or program
of employee benefits as defined in Section 1002 of Title 29 of the
United States Code (Employee Retirement Income Security Act).
   (f) "Insolvency" means when an issuer, licensed to transact the
business of a health care service plan in this state, has had a final
order of liquidation entered against it with a finding of insolvency
by a court of competent jurisdiction in the issuer's state of
domicile.
   (g) "Issuer" means a health care service plan delivering, or
issuing for delivery, Medicare supplement contracts in this state,
but does not include entities subject to Article 6 (commencing with
Section 10192.1) of Chapter 1 of Part 2 of Division 2 of the
Insurance Code.
   (h) "Medicare" means the federal Health Insurance for the Aged
Act, Title XVIII of the Social Security Amendments of 1965, as
amended.
   (i) "Medicare Advantage Plan" means a plan of coverage for health
benefits under Medicare Part C and includes:
   (1) Coordinated care plans that provide health care services,
including, but not limited to, health care service plans (with or
without a point-of-service option), plans offered by
provider-sponsored organizations, and preferred provider
organizations plans.
   (2) Medical savings account plans coupled with a contribution into
a Medicare Advantage medical savings account.
   (3) Medicare Advantage private fee-for-service plans.
   (j) "Medicare supplement contract" means a group or individual
plan contract of hospital and medical service associations or health
care service plans, other than a contract issued pursuant to a
contract under Section 1876 of the federal Social Security Act (42
U.S.C. Sec. 1395mm) or an issued contract under a demonstration
project specified in Section 1395ss(g)(1) of Title 42 of the United
States Code, that is advertised, marketed, or designed primarily as a
supplement to reimbursements under Medicare for the hospital,
medical, or surgical expenses of persons eligible for Medicare.
"Contract" means "Medicare supplement contract," unless the context
requires otherwise. "Medicare supplement contract" does not include a
Medicare Advantage plan established under Medicare Part C, an
outpatient prescription drug plan established under Medicare Part D,
or a health care prepayment plan that provides benefits pursuant to
an agreement under subparagraph (A) of paragraph (1) of subsection
(a) of Section 1833 of the federal Social Security Act.
   (k) "1990 standardized Medicare supplement benefit plan," "1990
standardized benefit plan," or "1990 plan" means a group or
individual Medicare supplement contract issued on or after July 21,
1992, and with an effective date prior to June 1, 2010, and includes
Medicare supplement contracts renewed on or after that date that are
not replaced by the issuer at the request of the enrollee or
subscriber.
   (l) "2010 standardized Medicare supplement benefit plan," "2010
standardized benefit plan," or "2010 plan" means a group or
individual Medicare supplement contract issued with an effective date
on or after June 1, 2010.
   (m) "Secretary" means the Secretary of the United States
Department of Health and Human Services.
  SEC. 117.  Section 1358.12 of the Health and Safety Code is amended
to read:
   1358.12.  (a) (1) With respect to the guaranteed issue of a
Medicare supplement contract, eligible persons are those individuals
described in subdivision (b) who seek to enroll under the contract
during the period specified in subdivision (c), and who submit
evidence of the date of termination or disenrollment or enrollment in
Medicare Part D with the application for a Medicare supplement
contract.
   (2) With respect to eligible persons, an issuer shall not take any
of the following actions:
   (A) Deny or condition the issuance or effectiveness of a Medicare
supplement contract described in subdivision (e) that is offered and
is available for issuance to new enrollees by the issuer.
   (B) Discriminate in the pricing of that Medicare supplement
contract because of health status, claims experience, receipt of
health care, or medical condition.
   (C) Impose an exclusion of benefits based on a preexisting
condition under that Medicare supplement contract.
   (b) An eligible person is an individual described in any of the
following paragraphs:
   (1) The individual is enrolled under an employee welfare benefit
plan that provides health benefits that supplement the benefits under
Medicare and either of the following applies:
   (A) The plan either terminates or ceases to provide all of those
supplemental health benefits to the individual.
   (B) The employer no longer provides the individual with insurance
that covers all of the payment for the 20-percent coinsurance.
   (2) The individual is enrolled with a Medicare Advantage
organization under a Medicare Advantage plan under Medicare Part C,
and any of the following circumstances apply:
   (A) The certification of the organization or plan has been
terminated.
   (B) The organization has terminated or otherwise discontinued
providing the plan in the area in which the individual resides.
   (C) The individual is no longer eligible to elect the plan because
of a change in the individual's place of residence or other change
in circumstances specified by the secretary. Those changes in
circumstances shall not include termination of the individual's
enrollment on the basis described in Section 1851(g)(3)(B) of the
federal Social Security Act where the individual has not paid
premiums on a timely basis or has engaged in disruptive behavior as
specified in standards under Section 1856 of the federal Social
Security Act, or the plan is terminated for all individuals within a
residence area.
   (D) The Medicare Advantage plan in which the individual is
enrolled reduces any of its benefits or increases the amount of cost
sharing or discontinues for other than good cause relating to quality
of care, its relationship or contract under the plan with a provider
who is currently furnishing services to the individual. An
individual shall be eligible under this subparagraph for a Medicare
supplement contract issued by the same issuer through which the
individual was enrolled at the time the reduction, increase, or
discontinuance described above occurs or, commencing January 1, 2007,
for one issued by a subsidiary of the parent company of that issuer
or by a network that contracts with the parent company of that
issuer.
   (E) The individual demonstrates, in accordance with guidelines
established by the secretary, either of the following:
   (i) The organization offering the plan substantially violated a
material provision of the organization's contract under this article
in relation to the individual, including the failure to provide on a
timely basis medically necessary care for which benefits are
available under the plan or the failure to provide the covered care
in accordance with applicable quality standards.
   (ii) The organization, or agent or other entity acting on the
organization's behalf, materially misrepresented the plan's
provisions in marketing the plan to the individual.
   (F) The individual meets other exceptional conditions as the
secretary may provide.
   (3) The individual is 65 years of age or older, is enrolled with a
Program of All-Inclusive Care for the Elderly (PACE) provider under
Section 1894 of the federal Social Security Act, and circumstances
similar to those described in paragraph (2) exist that would permit
discontinuance of the individual's enrollment with the provider, if
the individual were enrolled in a Medicare Advantage plan.
   (4) The individual meets both of the following conditions:
   (A) The individual is enrolled with any of the following:
   (i) An eligible organization under a contract under Section 1876
of the federal Social Security Act (Medicare cost).
   (ii) A similar organization operating under demonstration project
authority, effective for periods before April 1, 1999.
   (iii) An organization under an agreement under Section 1833(a)(1)
(A) of the federal Social Security Act (health care prepayment plan).

   (iv) An organization under a Medicare Select policy.
   (B) The enrollment ceases under the same circumstances that would
permit discontinuance of an individual's election of coverage under
paragraph (2) or (3).
   (5) The individual is enrolled under a Medicare supplement
contract, and the enrollment ceases because of any of the following
circumstances:
   (A) The insolvency of the issuer or bankruptcy of the nonissuer
organization, or other involuntary termination of coverage or
enrollment under the contract.
   (B) The issuer of the contract substantially violated a material
provision of the contract.
   (C) The issuer, or an agent or other entity acting on the issuer's
behalf, materially misrepresented the contract's provisions in
marketing the contract to the individual.
   (6) The individual meets both of the following conditions:
   (A) The individual was enrolled under a Medicare supplement
contract and terminates enrollment and subsequently enrolls, for the
first time, with any Medicare Advantage organization under a Medicare
Advantage plan under Medicare Part C, any eligible organization
under a contract under Section 1876 of the federal Social Security
Act (Medicare cost), any similar organization operating under
demonstration project authority, any PACE provider under Section 1894
of the federal Social Security Act, or a Medicare Select policy.
   (B) The subsequent enrollment under subparagraph (A) is terminated
by the individual during any period within the first 12 months of
the subsequent enrollment (during which the enrollee is permitted to
terminate the subsequent enrollment under Section 1851(e) of the
federal Social Security Act).
   (7) The individual upon first becoming eligible for benefits under
Medicare Part A at 65 years of age, enrolls in a Medicare Advantage
plan under Medicare Part C or with a PACE provider under Section 1894
of the federal Social Security Act, and disenrolls from the plan or
program not later than 12 months after the effective date of
enrollment.
   (8) The individual while enrolled under a Medicare supplement
contract that covers outpatient prescription drugs enrolls in a
Medicare Part D plan during the initial enrollment period, terminates
enrollment in the Medicare supplement contract, and submits evidence
of enrollment in Medicare Part D along with the application for a
contract described in paragraph (4) of subdivision (e).
   (c) (1) In the case of an individual described in paragraph (1) of
subdivision (b), the guaranteed issue period begins on the later of
the following two dates and ends on the date that is 63 days after
the date the applicable coverage terminated:
   (A) The date the individual receives a notice of termination or
cessation of all supplemental health benefits or, if no notice is
received, the date of the notice denying a claim because of a
termination or cessation of benefits.
   (B) The date that the applicable coverage terminates or ceases.
   (2) In the case of an individual described in paragraphs (2), (3),
(4), (6), and (7) of subdivision (b) whose enrollment is terminated
involuntarily, the guaranteed issue period begins on the date that
the individual receives a notice of termination and ends 63 days
after the date the applicable coverage is terminated.
   (3) In the case of an individual described in subparagraph (A) of
paragraph (5) of subdivision (b), the guaranteed issue period begins
on the earlier of the following two dates and ends on the date that
is 63 days after the date the coverage is terminated:
   (A) The date that the individual receives a notice of termination,
a notice of the issuer's bankruptcy or insolvency, or other similar
notice if any.
   (B) The date that the applicable coverage is terminated.
   (4) In the case of an individual described in paragraph (2), (3),
(6), or (7) of, or in subparagraph (B) or (C) of paragraph (5) of,
subdivision (b) who disenrolls voluntarily, the guaranteed issue
period begins on the date that is 60 days before the effective date
of the disenrollment and ends on the date that is 63 days after the
effective date of the disenrollment.
   (5) In the case of an individual described in paragraph (8) of
subdivision (b), the guaranteed issue period begins on the date the
individual receives notice pursuant to Section 1882(v)(2)(B) of the
federal Social Security Act from the Medicare supplement issuer
during the 60-day period immediately preceding the initial enrollment
period for Medicare Part D and ends on the date that is 63 days
after the effective date of the individual's coverage under Medicare
Part D.
   (6) In the case of an individual described in subdivision (b) who
is not included in this subdivision, the guaranteed issue period
begins on the effective date of disenrollment and ends on the date
that is 63 days after the effective date of disenrollment.
   (d) (1) In the case of an individual described in paragraph (6) of
subdivision (b), or deemed to be so described pursuant to this
paragraph, whose enrollment with an organization or provider
described in subparagraph (A) of paragraph (6) of subdivision (b) is
involuntarily terminated within the first 12 months of enrollment and
who, without an intervening enrollment, enrolls with another such
organization or provider, the subsequent enrollment shall be deemed
to be an initial enrollment described in paragraph (6) of subdivision
(b).
   (2) In the case of an individual described in paragraph (7) of
subdivision (b), or deemed to be so described pursuant to this
paragraph, whose enrollment with a plan or in a program described in
paragraph (7) of subdivision (b) is involuntarily terminated within
the first 12 months of enrollment and who, without an intervening
enrollment, enrolls in another such plan or program, the subsequent
enrollment shall be deemed to be an initial enrollment described in
paragraph (7) of subdivision (b).
   (3) For purposes of paragraphs (6) and (7) of subdivision (b), an
enrollment of an individual with an organization or provider
described in subparagraph (A) of paragraph (6) of subdivision (b), or
with a plan or in a program described in paragraph (7) of
subdivision (b), shall not be deemed to be an initial enrollment
under this paragraph after the two-year period beginning on the date
on which the individual first enrolled with such an organization,
provider, plan, or program.
   (e) (1) Under paragraphs (1), (2), (3), (4), and (5) of
subdivision (b), an eligible individual is entitled to a Medicare
supplement contract that has a benefit package classified as Plan A,
B, C, F (including a
   high deductible Plan F), K, or L offered by any issuer.
   (2) (A) Under paragraph (6) of subdivision (b), an eligible
individual is entitled to the same Medicare supplement contract in
which he or she was most recently enrolled, if available from the
same issuer. If that contract is not available, the eligible
individual is entitled to a Medicare supplement contract that has a
benefit package classified as Plan A, B, C, F (including a high
deductible Plan F), K, or L offered by any issuer.
   (B) On and after January 1, 2006, an eligible individual described
in this paragraph who was most recently enrolled in a Medicare
supplement contract with an outpatient prescription drug benefit, is
entitled to a Medicare supplement contract that is available from the
same issuer but without an outpatient prescription drug benefit or,
at the election of the individual, has a benefit package classified
as a Plan A, B, C, F (including high deductible Plan F), K, or L that
is offered by any issuer.
   (3) Under paragraph (7) of subdivision (b), an eligible individual
is entitled to any Medicare supplement contract offered by any
issuer.
   (4) Under paragraph (8) of subdivision (b), an eligible individual
is entitled to a Medicare supplement contract that has a benefit
package classified as Plan A, B, C, F (including a high deductible
Plan F), K, or L and that is offered and is available for issuance to
a new enrollee by the same issuer that issued the individual's
Medicare supplement contract with outpatient prescription drug
coverage.
   (f) (1) At the time of an event described in subdivision (b) by
which an individual loses coverage or benefits due to the termination
of a contract or agreement, policy, or plan, the organization that
terminates the contract or agreement, the issuer terminating the
policy or contract, or the administrator of the plan being
terminated, respectively, shall notify the individual of his or her
rights under this section and of the obligations of issuers of
Medicare supplement contracts under subdivision (a). The notice shall
be communicated contemporaneously with the notification of
termination.
   (2) At the time of an event described in subdivision (b) by which
an individual ceases enrollment under a contract or agreement,
policy, or plan, the organization that offers the contract or
agreement, regardless of the basis for the cessation of enrollment,
the issuer offering the policy or contract, or the administrator of
the plan, respectively, shall notify the individual of his or her
rights under this section, and of the obligations of issuers of
Medicare supplement contracts under subdivision (a). The notice shall
be communicated within 10 working days of the date the issuer
received notification of disenrollment.
   (g) An issuer shall refund any unearned premium that an enrollee
or subscriber paid in advance and shall terminate coverage upon the
request of an enrollee or subscriber.
  SEC. 118.  Section 1358.91 of the Health and Safety Code is amended
to read:
   1358.91.  The following standards are applicable to all Medicare
supplement contracts delivered or issued for delivery in this state
with an effective date on or after June 1, 2010. No contract may be
advertised, solicited, delivered, or issued for delivery in this
state as a Medicare supplement contract unless it complies with these
benefit plan standards. Benefit plan standards applicable to
Medicare supplement contracts issued with an effective date before
June 1, 2010, remain subject to the requirements of Section 1358.9.
   (a) (1) An issuer shall make available to each prospective
enrollee and subscriber a contract containing only the basic (core)
benefits, as defined in subdivision (b) of Section 1358.81.
   (2) If an issuer makes available any of the additional benefits
described in subdivision (c) of Section 1358.81, or offers
standardized benefit plan K or L, as described in paragraphs (8) and
(9) of subdivision (e), then the issuer shall make available to each
prospective enrollee and subscriber, in addition to a contract with
only the basic (core) benefits as described in paragraph (1), a
contract containing either standardized benefit plan C, as described
in paragraph (3) of subdivision (e), or standardized benefit plan F,
as described in paragraph (5) of subdivision (e).
   (b) No groups, packages or combinations of Medicare supplement
benefits other than those listed in this section shall be offered for
sale in this state, except as may be permitted in subdivision (f)
and by Section 1358.10.
   (c) Benefit plans shall be uniform in structure, language,
designation, and format to the standard benefit plans listed in
subdivision (e) and conform to the definitions in Section 1358.4.
Each benefit shall be structured in accordance with the format
provided in subdivisions (b) and (c) of Section 1358.81; or, in the
case of plan K or L, in paragraph (8) or (9) of subdivision (e) of
Section 1358.91 and list the benefits in the order shown in
subdivision (e). For purposes of this section, "structure, language,
and format" means style, arrangement, and overall content of a
benefit.
   (d) In addition to the benefit plan designations required in
subdivision (c), an issuer may use other designations to the extent
permitted by law.
   (e) With respect to the makeup of 2010 standardized benefit plans,
the following shall apply:
   (1) Standardized Medicare supplement benefit plan A shall include
only the following: the basic (core) benefits as defined in
subdivision (b) of Section 1358.81.
   (2) Standardized Medicare supplement benefit plan B shall include
only the following: the basic (core) benefit as defined in
subdivision (b) of Section 1358.81, plus 100 percent of the Medicare
Part A deductible as defined in paragraph (1) of subdivision (c) of
Section 1358.81.
   (3) Standardized Medicare supplement benefit plan C shall include
only the following: the basic (core) benefit as defined in
subdivision (b) of Section 1358.81, plus 100 percent of the Medicare
Part A deductible, skilled nursing facility care, 100 percent of the
Medicare Part B deductible, and medically necessary emergency care in
a foreign country, as defined in paragraphs (1), (3), (4), and (6)
of subdivision (c) of Section 1358.81, respectively.
   (4) Standardized Medicare supplement benefit plan D shall include
only the following: the basic (core) benefit, as defined in
subdivision (b) of Section 1358.81, plus 100 percent of the Medicare
Part A deductible, skilled nursing facility care, and medically
necessary emergency care in a foreign country, as defined in
paragraphs (1), (3), and (6) of subdivision (c) of Section 1358.81,
respectively.
   (5) Standardized Medicare supplement benefit plan F shall include
only the following: the basic (core) benefit as defined in
subdivision (b) of Section 1358.81, plus 100 percent of the Medicare
Part A deductible, skilled nursing facility care, 100 percent of the
Medicare Part B deductible, 100 percent of the Medicare Part B excess
charges, and medically necessary emergency care in a foreign
country, as defined in paragraphs (1), (3), (4), (5), and (6) of
subdivision (c) of Section 1358.81, respectively.
   (6) Standardized Medicare supplement benefit high deductible plan
F shall include only the following: 100 percent of covered expenses
following the payment of the annual deductible set forth in
subparagraph (B).
   (A) The basic (core) benefit as defined in subdivision (b) of
Section 1358.81, plus 100 percent of the Medicare Part A deductible,
skilled nursing facility care, 100 percent of the Medicare Part B
deductible, 100 percent of the Medicare Part B excess charges, and
medically necessary emergency care in a foreign country, as defined
in paragraphs (1), (3), (4), (5), and (6) of subdivision (c) of
Section 1358.81, respectively.
   (B) The annual deductible in high deductible plan F shall consist
of out-of-pocket expenses, other than premiums, for services covered
by plan F, and shall be in addition to any other specific benefit
deductibles. The basis for the deductible shall be one thousand five
hundred dollars ($1,500) and shall be adjusted annually from 1999 by
the Secretary of the United States Department of Health and Human
Services to reflect the change in the Consumer Price Index for all
urban consumers for the 12-month period ending with August of the
preceding year, and rounded to the nearest multiple of ten dollars
($10).
   (7) Standardized Medicare supplement benefit plan G shall include
only the following: the basic (core) benefit as defined in
subdivision (b) of Section 1358.81, plus 100 percent of the Medicare
Part A deductible, skilled nursing facility care, 100 percent of the
Medicare Part B excess charges, and medically necessary emergency
care in a foreign country, as defined in paragraphs (1), (3), (5),
and (6) of subdivision (c) of Section 1358.81, respectively.
   (8) Standardized Medicare supplement benefit plan K shall include
only the following:
   (A) Coverage of 100 percent of the Part A hospital coinsurance
amount for each day used from the 61st through the 90th day in any
Medicare benefit period.
   (B) Coverage of 100 percent of the Part A hospital coinsurance
amount for each Medicare lifetime inpatient reserve day used from the
91st through the 150th day in any Medicare benefit period.
   (C) Upon exhaustion of the Medicare hospital inpatient coverage,
including the lifetime reserve days, coverage of 100 percent of the
Medicare Part A eligible expenses for hospitalization paid at the
applicable prospective payment system (PPS) rate, or other
appropriate Medicare standard of payment, subject to a lifetime
maximum benefit of an additional 365 days. The provider shall accept
the issuer's payment as payment in full and may not bill the insured
for any balance.
   (D) Coverage for 50 percent of the Medicare Part A inpatient
hospital deductible amount per benefit period until the out-of-pocket
limitation is met as described in subparagraph (J).
   (E) Coverage for 50 percent of the coinsurance amount for each day
used from the 21st day through the 100th day in a Medicare benefit
period for posthospital skilled nursing facility care eligible under
Medicare Part A until the out-of-pocket limitation is met as
described in subparagraph (J).
   (F) Coverage for 50 percent of cost sharing for all Part A
Medicare eligible expenses and respite care until the out-of-pocket
limitation is met as described in subparagraph (J).
   (G) Coverage for 50 percent, under Medicare Part A or B, of the
reasonable cost of the first three pints of blood, or equivalent
quantities of packed red blood cells, as defined under federal
regulations, unless replaced in accordance with federal regulations
until the out-of-pocket limitation is met as described in
subparagraph (J).
   (H) Except for coverage provided in subparagraph (I), coverage for
50 percent of the cost sharing otherwise applicable under Medicare
Part B after the enrollee or subscriber pays the Part B deductible
until the out-of-pocket limitation is met as described in
subparagraph (J).
   (I) Coverage of 100 percent of the cost sharing for Medicare Part
B preventive services after the enrollee or subscriber pays the Part
B deductible.
   (J) Coverage of 100 percent of all cost sharing under Medicare
Parts A and B for the balance of the calendar year after the
individual has reached the out-of-pocket limitation on annual
expenditures under Medicare Parts A and B of four thousand dollars
($4,000) in 2006, indexed each year by the appropriate inflation
adjustment specified by the Secretary of the United States Department
of Health and Human Services.
   (9) Standardized Medicare supplement benefit plan L shall include
only the following:
   (A) The benefits described in subparagraphs (A), (B), (C), and (I)
of paragraph (8).
   (B) The benefits described in subparagraphs (D), (E), (F), (G),
and (H) of paragraph (8), but substituting 75 percent for 50 percent.

   (C) The benefit described in subparagraph (J) of paragraph (8),
but substituting two thousand dollars ($2,000) for four thousand
dollars ($4,000).
   (10) Standardized Medicare supplement benefit plan M shall include
only the following: the basic (core) benefit as defined in
subdivision (b) of Section 1358.81, plus 50 percent of the Medicare
Part A deductible, skilled nursing facility care, and medically
necessary emergency care in a foreign country, as defined in
paragraphs (2), (3), and (6) of subdivision (c) of Section 1358.81,
respectively.
   (11) Standardized Medicare supplement benefit plan N shall include
only the following: the basic (core) benefit as defined in
subdivision (b) of Section 1358.81, plus 100 percent of the Medicare
Part A deductible, skilled nursing facility care, and medically
necessary emergency care in a foreign country, as defined in
paragraphs (1), (3), and (6) of subdivision (c) of Section 1358.81,
respectively, with copayments in the following amounts:
   (A) The lesser of twenty dollars ($20) or the Medicare Part B
coinsurance or copayment for each covered health care provider office
visit, including visits to medical specialists.
   (B) The lesser of fifty dollars ($50) or the Medicare Part B
coinsurance or copayment for each covered emergency room visit;
however, this copayment shall be waived if the enrollee or subscriber
is admitted to any hospital and the emergency visit is subsequently
covered as a Medicare Part A expense.
   (f) An issuer may, with the prior approval of the director, offer
contracts with new or innovative benefits, in addition to the
standardized benefits provided in a contract that otherwise complies
with the applicable standards. The new or innovative benefits shall
include only benefits that are appropriate to Medicare supplement
contracts, are new or innovative, are not otherwise available, and
are cost effective. Approval of new or innovative benefits shall not
adversely impact the goal of Medicare supplement simplification. New
or innovative benefits shall not include an outpatient prescription
drug benefit. New or innovative benefits shall not be used to change
or reduce benefits, including a change of any cost-sharing provision,
in any standardized plan.
  SEC. 119.  Section 1367.66 of the Health and Safety Code is amended
to read:
   1367.66.  Every individual or group health care service plan
contract, except for a specialized health care service plan, that is
issued, amended, or renewed on or after January 1, 2002, and that
includes coverage for treatment or surgery of cervical cancer shall
also be deemed to provide coverage for an annual cervical cancer
screening test upon the referral of the patient's physician and
surgeon, a nurse practitioner, or a certified nurse midwife,
providing care to the patient and operating within the scope of
practice otherwise permitted for the licensee.
   The coverage for an annual cervical cancer screening test provided
pursuant to this section shall include the conventional Pap test, a
human papillomavirus screening test that is approved by the federal
Food and Drug Administration, and the option of any cervical cancer
screening test approved by the federal Food and Drug Administration,
upon the referral of the patient's health care provider.
   Nothing in this section shall be construed to establish a new
mandated benefit or to prevent application of deductible or copayment
provisions in an existing plan contract. The Legislature intends in
this section to provide that cervical cancer screening services are
deemed to be covered if the plan contract includes coverage for
cervical cancer treatment or surgery.
  SEC. 120.  Section 1418.21 of the Health and Safety Code is amended
to read:
   1418.21.  (a) A skilled nursing facility that has been certified
for purposes of Medicare or Medicaid shall post the overall facility
rating information determined by the federal Centers for Medicare and
Medicaid Services (CMS) in accordance with the following
requirements:
   (1) The information shall be posted in at least the following
locations in the facility:
   (A) An area accessible and visible to members of the public.
   (B) An area used for employee breaks.
   (C) An area used by residents for communal functions, such as
dining, resident council meetings, or activities.
   (2) The information shall be posted on white or light-colored
paper that includes all of the following, in the following order:
   (A) The full name of the facility, in a clear and easily readable
font of at least 28 point.
   (B) The full address of the facility in a clear and easily
readable font of at least 20 point.
   (C) The most recent overall star rating given by CMS to that
facility, except that a facility shall have seven business days from
the date when it receives a different rating from CMS to include the
updated rating in the posting. The star rating shall be aligned in
the center of the page. The star rating shall be expressed as the
number that reflects the number of stars given to the facility by
CMS. The number shall be in a clear and easily readable font of at
least two inches print.
   (D) Directly below the star symbols shall be the following text in
a clear and easily readable font of at least 28 point:
   "The above number is out of 5 stars."
   (E) Directly below the text described in subparagraph (D) shall be
the following text in a clear and easily readable font of at least
14 point:
   "This facility is reviewed annually and has been licensed by the
State of California and certified by the federal Centers for Medicare
and Medicaid Services (CMS). CMS rates facilities that are certified
to accept Medicare or Medicaid. CMS gave the above rating to this
facility. A detailed explanation of this rating is maintained at this
facility and will be made available upon request. This information
can also be accessed online at the Nursing Home Compare Internet Web
site at http://www.medicare.gov/NHcompare. Like any information, the
Five-Star Quality Rating System has strengths and limits. The
criteria upon which the rating is determined may not represent all of
the aspects of care that may be important to you. You are encouraged
to discuss the rating with facility staff. The Five-Star Quality
Rating System was created to help consumers, their families, and
caregivers compare nursing homes more easily and help identify areas
about which you may want to ask questions. Nursing home ratings are
assigned based on ratings given to health inspections, staffing, and
quality measures. Some areas are assigned a greater weight than other
areas. These ratings are combined to calculate the overall rating
posted here."
   (F) Directly below the text described in subparagraph (E), the
following text shall appear in a clear and easily readable font of at
least 14 point:


   "State licensing information on skilled nursing facilities is
available on the State Department of Public Health's Internet Web
site at: www.cdph.ca.gov, under Programs, Licensing and
Certification, Health Facilities Consumer Information System."


   (3) For the purposes of this section, "a detailed explanation of
this rating" shall include, but shall not be limited to, a printout
of the information explaining the Five-Star Quality Rating System
that is available on the CMS Nursing Home Compare Internet Web site.
This information shall be maintained at the facility and shall be
made available upon request.
   (4) The requirements of this section shall be in addition to any
other posting or inspection report availability requirements.
   (b) Violation of this section shall constitute a class B
violation, as defined in subdivision (e) of Section 1424 and,
notwithstanding Section 1290, shall not constitute a crime. Fines
from a violation of this section shall be deposited into the State
Health Facilities Citation Penalties Account, created pursuant to
Section 1417.2.
   (c) This section shall be operative on January 1, 2011.
  SEC. 121.  Section 1429 of the Health and Safety Code is amended to
read:
   1429.  (a) Each class "AA" and class "A" citation specified in
subdivisions (c) and (d) of Section 1424 that is issued, or a copy or
copies thereof, shall be prominently posted for 120 days. The
citation or copy shall be posted in a place or places in plain view
of the patients or residents in the long-term health care facility,
persons visiting those patients or residents, and persons who inquire
about placement in the facility.
   (1) The citation shall be posted in at least the following
locations in the facility:
   (A) An area accessible and visible to members of the public.
   (B) An area used for employee breaks.
   (C) An area used by residents for communal functions, such as
dining, resident council meetings, or activities.
   (2) The citation, along with a cover sheet, shall be posted on a
white or light-colored sheet of paper, at least 81/2 by 11 inches in
size, that includes all of the following information:
   (A) The full name of the facility, in a clear and easily readable
font in at least 28-point type.
   (B) The full address of the facility, in a clear and easily
readable font in at least 20-point type.
   (C) Whether the citation is class "AA" or class "A."
   (3) The facility may post the plan of correction.
   (4) The facility may post a statement disputing the citation or a
statement showing the appeal status, or both.
   (5) The facility may remove and discontinue the posting required
by this section if the citation is withdrawn or dismissed by the
department, or is dismissed as a result of a citation review
conference.
   (b) Each class "B" citation specified in subdivision (e) of
Section 1424 that is issued pursuant to this section and that has
become final, or a copy or copies thereof, shall be retained by the
licensee at the facility cited until the violation is corrected to
the satisfaction of the department. Each citation shall be made
promptly available by the licensee for inspection or examination by
any member of the public who so requests. In addition, every licensee
shall post in a place or places in plain view of the patient or
resident in the long-term health care facility, persons visiting
those patients or residents, and persons who inquire about placement
in the facility, a prominent notice informing those persons that
copies of all final uncorrected citations issued by the department to
the facility will be made promptly available by the licensee for
inspection by any person who so requests.
   (c) A violation of this section shall constitute a class "B"
violation, and shall be subject to a civil penalty in the amount of
one thousand dollars ($1,000), as provided in subdivision (e) of
Section 1424. Notwithstanding Section 1290, a violation of this
section shall not constitute a crime. Fines imposed pursuant to this
section shall be deposited into the State Health Facilities Citation
Penalties Account, created pursuant to Section 1417.2.
  SEC. 122.  Section 1499 of the Health and Safety Code is amended to
read:
   1499.  (a) Any person or entity licensed or certificated under
Chapter 1 (commencing with Section 1200), Chapter 2 (commencing with
Section 1250), Chapter 2.3 (commencing with Section 1400), Chapter
2.35 (commencing with Section 1416), Chapter 3.3 (commencing with
Section 1570), Chapter 8 (commencing with Section 1725), Chapter 8.3
(commencing with Section 1743), Chapter 8.5 (commencing with Section
1745), or Chapter 8.6 (commencing with Section 1760) of this code, or
under Section 1247.6 of the Business and Professions Code, shall, in
addition to all other requirements, disclose as part of the
application for the license or certificate any revocation or other
final administrative action taken against a license, certificate,
registration, or other approval to engage in a profession, vocation,
or occupation, or a license or other permission to operate a facility
or institution.
   (b) The department may consider, in determining whether to grant
or deny the license or certification, any final revocation or other
final administrative action taken against a license, certificate,
registration, or other permission to engage in a profession,
vocation, or occupation or a license or other permission to operate a
facility or institution.
   (c) An applicant and any other person specified in this
subdivision, as part of the background clearance process, shall
provide information as to whether or not the person has any prior
criminal convictions, has had any arrests within the past 12-month
period, or has any active arrests, and shall certify that, to the
best of his or her knowledge, the information provided is true. This
requirement is not intended to duplicate existing requirements for
individuals who are required to submit fingerprint images as part of
a criminal background clearance process. Every applicant shall
provide information on any prior administrative action taken against
him or her by any federal, state, or local government agency and
shall certify that, to the best of his or her knowledge, the
information provided is true. An applicant or other person required
to provide information pursuant to this section that knowingly or
willfully makes false statements, representations, or omissions may
be subject to administrative action, including, but not limited to,
denial of his or her application or exemption or revocation of any
exemption previously granted.
  SEC. 123.  Section 1568.03 of the Health and Safety Code is amended
to read:
   1568.03.  (a) No person, firm, partnership, association, or
corporation within the state and no state or local public agency
shall operate, establish, manage, conduct, or maintain a residential
care facility in this state without first obtaining and maintaining a
valid license therefor, as provided in this chapter.
   (b) A facility may accept or retain residents requiring varying
levels of care. However, a facility shall not accept or retain
residents who require a higher level of care than the facility is
authorized to provide. Persons who require 24-hour skilled nursing
intervention shall not be appropriate for a residential care
facility.
   (c) This chapter shall not apply to the following:
   (1) Any health facility, as defined in Section 1250.
   (2) Any clinic, as defined in Section 1200.
   (3) Any arrangement for the receiving and care of persons with
chronic, life-threatening illness by a relative, guardian or
conservator, significant other, or close friend; or any arrangement
for the receiving and care of persons with chronic, life-threatening
illness from only one family as respite for the relative, guardian or
conservator, significant other, or close friend, if the arrangement
is not for financial profit and occurs only occasionally and
                                    irregularly, as defined by
regulations of the department.
   (4) (A) Any house, institution, hotel, foster home, shared housing
project, or other similar facility that is limited to providing any
of the following: housing, meals, transportation, housekeeping,
recreational and social activities, the enforcement of house rules,
counseling on activities of daily living, and service referrals, as
long as both of the following conditions are met:
   (i) After any referral, all residents thereof independently obtain
care and supervision and medical services without the assistance of
the facility or of any person or entity with an organizational or
financial connection with that facility.
   (ii) No resident thereof has an unmet need for care and
supervision or protective supervision. A memorandum of understanding
between the facility and any service agency to which it refers
residents does not necessarily itself constitute an agreement for
care and supervision of the resident.
   (B) In determining the applicability of this paragraph, the
department shall determine the residents' need for care and
supervision, if any, and shall identify the persons or entities
providing or assisting in the provision of care and supervision. This
paragraph shall apply only if the department determines that the
care and supervision needs of all residents are being independently
met.
   (5) (A) (i) Any housing occupied by elderly or disabled persons,
or both, that is approved and operated pursuant to Section 202 of
Public Law 86-372 (12 U.S.C. Sec. 1701q), or Section 811 of Public
Law 101-625 (42 U.S.C. Sec. 8013), or whose mortgage is insured
pursuant to Section 236 of Public Law 90-448 (12 U.S.C. Sec. 1715z),
or that receives mortgage assistance pursuant to Section 221d (3) of
Public Law 87-70 (12 U.S.C. Sec. 1751  l  ), where
supportive services are made available to residents at their option,
as long as the project owner or operator does not contract for or
provide the supportive services.
   (ii) Any housing that qualifies for a low-income housing credit
pursuant to Section 252 of Public Law 99-514 (26 U.S.C. Sec. 42) or
that is subject to the requirements for rental dwellings for
low-income families pursuant to Section 8 of Public Law 93-383 (42
U.S.C. Sec. 1437f), and that is occupied by elderly or disabled
persons, or both, where supportive services are made available to
residents at their option, as long as the project owner or operator
does not contract for or provide the supportive services.
   (B) The project owner or operator to which subparagraph (A)
applies may coordinate, or help residents gain access to, the
supportive services, either directly or through a service
coordinator.
   (6) Any similar facility determined by the director.
   (d) A holder of a residential care facility license may hold or
obtain an additional license or a child day care facility license, as
long as the services required by each license are provided at
separate locations or distinctly separate sections of the building.
   (e) The director may bring an action to enjoin the violation or
threatened violation of this section in the superior court in and for
the county in which the violation occurred or is about to occur. Any
proceeding under this section shall conform to the requirements of
Chapter 3 (commencing with Section 525) of Title 7 of Part 2 of the
Code of Civil Procedure, except that the director shall not be
required to allege facts necessary to show or tending to show lack of
adequate remedy at law or irreparable damage or loss. The court
shall, if it finds the allegations to be true, issue its order
enjoining continuance of the violation.
  SEC. 124.  Section 1569.69 of the Health and Safety Code is amended
to read:
   1569.69.  (a) Each residential care facility for the elderly
licensed under this chapter shall ensure that each employee of the
facility who assists residents with the self-administration of
medications meets the following training requirements:
   (1) In facilities licensed to provide care for 16 or more persons,
the employee shall complete 16 hours of initial training. This
training shall consist of eight hours of hands-on shadowing training,
which shall be completed prior to assisting with the
self-administration of medications, and eight hours of other training
or instruction, as described in subdivision (f), which shall be
completed within the first two weeks of employment.
   (2) In facilities licensed to provide care for 15 or fewer
persons, the employee shall complete six hours of initial training.
This training shall consist of two hours of hands-on shadowing
training, which shall be completed prior to assisting with the
self-administration of medications, and four hours of other training
or instruction, as described in subdivision (f), which shall be
completed within the first two weeks of employment.
   (3) An employee shall be required to complete the training
requirements for hands-on shadowing training described in this
subdivision prior to assisting any resident in the
self-administration of medications. The training and instruction
described in this subdivision shall be completed, in their entirety,
within the first two weeks of employment.
   (4) The training shall cover all of the following areas:
   (A) The role, responsibilities, and limitations of staff who
assist residents with the self-administration of medication,
including tasks limited to licensed medical professionals.
   (B) An explanation of the terminology specific to medication
assistance.
   (C) An explanation of the different types of medication orders:
prescription, over-the-counter, controlled, and other medications.
   (D) An explanation of the basic rules and precautions of
medication assistance.
   (E) Information on medication forms and routes for medication
taken by residents.
   (F) A description of procedures for providing assistance with the
self-administration of medications in and out of the facility, and
information on the medication documentation system used in the
facility.
   (G) An explanation of guidelines for the proper storage, security,
and documentation of centrally stored medications.
   (H) A description of the processes used for medication ordering,
refills, and the receipt of medications from the pharmacy.
   (I) An explanation of medication side effects, adverse reactions,
and errors.
   (5) To complete the training requirements set forth in this
subdivision, each employee shall pass an examination that tests the
employee's comprehension of, and competency in, the subjects listed
in paragraph (4).
   (6) Residential care facilities for the elderly shall encourage
pharmacists and licensed medical professionals to use plain English
when preparing labels on medications supplied to residents. As used
in this section, "plain English" means that no abbreviations,
symbols, or Latin medical terms shall be used in the instructions for
the self-administration of medication.
   (7) The training requirements of this section are not intended to
replace or supplant those required of all staff members who assist
residents with personal activities of daily living as set forth in
Section 1569.625.
   (8) The training requirements of this section shall be repeated if
either of the following occurs:
   (A) An employee returns to work for the same licensee after a
break of service of more than 180 consecutive calendar days.
   (B) An employee goes to work for another licensee in a facility in
which he or she assists residents with the self-administration of
medication.
   (b) Each employee who received training and passed the examination
required in paragraph (5) of subdivision (a), and who continues to
assist with the self-administration of medicines, shall also complete
four hours of in-service training on medication-related issues in
each succeeding 12-month period.
   (c) The requirements set forth in subdivisions (a) and (b) do not
apply to persons who are licensed medical professionals.
   (d) Each residential care facility for the elderly that provides
employee training under this section shall use the training material
and the accompanying examination that are developed by, or in
consultation with, a licensed nurse, pharmacist, or physician. The
licensed residential care facility for the elderly shall maintain the
following documentation for each medical consultant used to develop
the training:
   (1) The name, address, and telephone number of the consultant.
   (2) The date when consultation was provided.
   (3) The consultant's organization affiliation, if any, and any
educational and professional qualifications specific to medication
management.
   (4) The training topics for which consultation was provided.
   (e) Each person who provides employee training under this section
shall meet the following education and experience requirements:
   (1) A minimum of five hours of initial, or certified continuing,
education or three semester units, or the equivalent, from an
accredited educational institution, on topics relevant to medication
management.
   (2) The person shall meet any of the following practical
experience or licensure requirements:
   (A) Two years of full-time experience, within the last four years,
as a consultant with expertise in medication management in areas
covered by the training described in subdivision (a).
   (B) Two years of full-time experience, or the equivalent, within
the last four years, as an administrator for a residential care
facility for the elderly, during which time the individual has acted
in substantial compliance with applicable regulations.
   (C) Two years of full-time experience, or the equivalent, within
the last four years, as a direct care provider assisting with the
self-administration of medications for a residential care facility
for the elderly, during which time the individual has acted in
substantial compliance with applicable regulations.
   (D) Possession of a license as a medical professional.
   (3) The licensed residential care facility for the elderly shall
maintain the following documentation on each person who provides
employee training under this section:
   (A) The person's name, address, and telephone number.
   (B) Information on the topics or subject matter covered in the
training.
   (C) The time, dates, and hours of training provided.
   (f) Other training or instruction, as required in paragraphs (1)
and (2) of subdivision (a), may be provided offsite, and may use
various methods of instruction, including, but not limited to, all of
the following:
   (1) Lectures by presenters who are knowledgeable about medication
management.
   (2) Video recorded instruction, interactive material, online
training, and books.
   (3) Other written or visual materials approved by organizations or
individuals with expertise in medication management.
   (g) Residential care facilities for the elderly licensed to
provide care for 16 or more persons shall maintain documentation that
demonstrates that a consultant pharmacist or nurse has reviewed the
facility's medication management program and procedures at least
twice a year.
   (h) Nothing in this section authorizes unlicensed personnel to
directly administer medications.
  SEC. 125.  Section 1599.645 of the Health and Safety Code is
amended to read:
   1599.645.  (a) Within 30 days of approval of a change of ownership
by the State Department of Public Health, the skilled nursing
facility shall send written notification to all current residents and
patients and to the primary contacts listed in the admission
agreement of each resident and patient. The notice shall disclose the
name of the owner and licensee of the skilled nursing facility and
the name and contact information of a single entity that is
responsible for all aspects of patient care and the operation of the
facility.
   (b) The department shall accept a copy of the written notice and a
copy of the list of individuals and mailing addresses to whom the
facility sent the notification as satisfactory evidence that the
facility provided the required written notification.
  SEC. 126.  Section 1736.5 of the Health and Safety Code is amended
to read:
   1736.5.  (a) The department shall deny a training application and
deny, suspend, or revoke a certificate issued under this article if
the applicant or certificate holder has been convicted of a violation
or attempted violation of any of the following Penal Code
provisions: Section 187, subdivision (a) of Section 192, Section 203,
205, 206, 207, 209, 210, 210.5, 211, 220, 222, 243.4, 245, 261, 262,
or 264.1, Sections 265 to 267, inclusive, Section 273a, 273d, 273.5,
or 285, subdivisions (c), (d), (f), and (g) of Section 286, Section
288, subdivisions (c), (d), (f), and (g) of Section 288a, Section
288.5, 289, 289.5, 368, 451, 459, 470, 475, 484, or 484b, Sections
484d to 484j, inclusive, or Section 487, 488, 496, 503, 518, or 666,
unless any of the following applies:
   (1) The person was convicted of a felony and has obtained a
certificate of rehabilitation under Chapter 3.5 (commencing with
Section 4852.01) of Title 6 of Part 3 of the Penal Code and the
information or accusation against him or her has been dismissed
pursuant to Section 1203.4 of the Penal Code.
   (2) The person was convicted of a misdemeanor and the information
or accusation against him or her has been dismissed pursuant to
Section 1203.4 or 1203.4a of the Penal Code.
   (3) The certificate holder was convicted of a felony or a
misdemeanor, but has previously disclosed the fact of each conviction
to the department, and the department has made a determination in
accordance with law that the conviction does not disqualify the
applicant from certification.
   (b) An application or certificate shall be denied, suspended, or
revoked upon conviction in another state of an offense that, if
committed or attempted in this state, would have been punishable as
one or more of the offenses set forth in subdivision (a), unless
evidence of rehabilitation comparable to the certificate of
rehabilitation or dismissal of a misdemeanor set forth in paragraph
(1) or (2) of subdivision (a) is provided.
   (c) (1) The department may deny an application or deny, suspend,
or revoke a certificate issued under this article for any of the
following:
   (A) Unprofessional conduct, including, but not limited to,
incompetence, gross negligence, physical, mental, or verbal abuse of
patients, or misappropriation of property of patients or others.
   (B) Conviction of a crime substantially related to the
qualifications, functions, and duties of a home health aide,
irrespective of a subsequent order under Section 1203.4, 1203.4a, or
4852.13 of the Penal Code, where the department determines that the
applicant or certificate holder has not adequately demonstrated that
he or she has been rehabilitated and will present a threat to the
health, safety, or welfare of patients.
   (C) Conviction for, or use of, any controlled substance as defined
in Division 10 (commencing with Section 11000) of this code, or any
dangerous drug, as defined in Section 4022 of the Business and
Professions Code, or alcoholic beverages, to an extent or in a manner
dangerous or injurious to the home health aide, any other person, or
the public, to the extent that this use would impair the ability to
conduct, with safety to the public, the practice authorized by a
certificate.
   (D) Procuring a home health aide certificate by fraud,
misrepresentation, or mistake.
   (E) Making or giving any false statement or information in
conjunction with the application for issuance of a home health aide
certificate or training and examination application.
   (F) Impersonating any applicant, or acting as proxy for an
applicant, in any examination required under this article for the
issuance of a certificate.
   (G) Impersonating another home health aide, a licensed vocational
nurse, or a registered nurse, or permitting or allowing another
person to use a certificate for the purpose of providing nursing
services.
   (H) Violating or attempting to violate, directly or indirectly, or
assisting in or abetting the violation of, or conspiring to violate
any provision or term of, this article.
   (2) In determining whether or not to deny an application or deny,
suspend, or revoke a certificate issued under this article pursuant
to this subdivision, the department shall take into consideration the
following factors as evidence of good character and rehabilitation:
   (A) The nature and seriousness of the offense under consideration
and its relationship to the person's employment duties and
responsibilities.
   (B) Activities since conviction, including employment or
participation in therapy or education, that would indicate changed
behavior.
   (C) The time that has elapsed since the commission of the conduct
or offense referred to in subparagraph (A) or (B) and the number of
offenses.
   (D) The extent to which the person has complied with any terms of
parole, probation, restitution, or any other sanction lawfully
imposed against the person.
   (E) Any rehabilitation evidence, including character references,
submitted by the person.
   (F) Employment history and current employer recommendations.
   (G) Circumstances surrounding the commission of the offense that
would demonstrate the unlikelihood of repetition.
   (H) Granting by the Governor of a full and unconditional pardon.
   (I) A certificate of rehabilitation from a superior court.
   (d) When the department determines that a certificate shall be
suspended, the department shall specify the period of actual
suspension. The department may determine that the suspension shall be
stayed, placing the certificate holder on probation with specified
conditions for a period not to exceed two years. When the department
determines that probation is the appropriate action, the certificate
holder shall be notified that in lieu of the department proceeding
with a formal action to suspend the certification and in lieu of an
appeal pursuant to subdivision (g), the certificate holder may
request to enter into a diversion program agreement. A diversion
program agreement shall specify terms and conditions related to
matters including, but not limited to, work performance,
rehabilitation, training, counseling, progress reports, and treatment
programs. If a certificate holder successfully completes a diversion
program, no action shall be taken upon the allegations that were the
basis for the diversion agreement. Upon failure of the certificate
holder to comply with the terms and conditions of an agreement, the
department may proceed with a formal action to suspend or revoke the
certification.
   (e) A plea or verdict of guilty, or a conviction following a plea
of nolo contendere, shall be deemed a conviction within the meaning
of this article. The department may deny an application or deny,
suspend, or revoke a certification based on a conviction as provided
in this article when the judgment of conviction is entered or when an
order granting probation is made suspending the imposition of
sentence.
   (f) Upon determination to deny an application or deny, revoke, or
suspend a certificate, the department shall notify the applicant or
certificate holder in writing by certified mail of both of the
following:
   (1) The reasons for the determination.
   (2) The applicant's or certificate holder's right to appeal the
determination if the determination was made under subdivision (c).
   (g) (1) Upon written notification that the department has
determined that an application shall be denied or a certificate shall
be denied, suspended, or revoked under subdivision (c), the
applicant or certificate holder may request an administrative hearing
by submitting a written request to the department within 20 business
days of receipt of the written notification. Upon receipt of a
written request, the department shall hold an administrative hearing
pursuant to the procedures specified in Section 100171, except where
those procedures are inconsistent with this section.
   (2) A hearing under this section shall be conducted by a hearing
officer or administrative law judge designated by the director at a
location, other than the work facility, that is convenient to the
applicant or certificate holder. The hearing shall be audio or video
recorded and a written decision shall be sent by certified mail to
the applicant or certificate holder within 30 calendar days of the
hearing. Except as specified in subdivision (h), the effective date
of an action to revoke or suspend a certificate shall be specified in
the written decision, or if no administrative hearing is timely
requested, the effective date shall be 21 business days from written
notification of the department's determination to revoke or suspend.
   (h) The department may revoke or suspend a certificate prior to
any hearing when immediate action is necessary in the judgment of the
director to protect the public welfare. Notice of this action,
including a statement of the necessity of immediate action to protect
the public welfare, shall be sent in accordance with subdivision
(f). If the certificate holder requests an administrative hearing
pursuant to subdivision (g), the department shall hold the
administrative hearing as soon as possible but not later than 30
calendar days from receipt of the request for a hearing. A written
hearing decision upholding or setting aside the action shall be sent
by certified mail to the certificate holder within 30 calendar days
of the hearing.
   (i) Upon the expiration of the term of suspension, the certificate
holder shall be reinstated by the department and shall be entitled
to resume practice unless it is established to the satisfaction of
the department that the person has practiced as a home health aide in
California during the term of suspension. In this event, the
department shall revoke the person's certificate.
   (j) Upon a determination to deny an application or deny, revoke,
or suspend a certificate, the department shall notify the employer of
the applicant or certificate holder in writing of that
determination, and whether the determination is final, or whether a
hearing is pending relating to this determination. If a licensee or
facility is required to deny employment or terminate employment of
the employee based upon notice from the state that the employee is
determined to be unsuitable for employment under this section, the
licensee or facility shall not incur criminal, civil, unemployment
insurance, workers' compensation, or administrative liability as a
result of that denial or termination.
  SEC. 127.  Section 1798.200 of the Health and Safety Code is
amended to read:
   1798.200.  (a) (1) (A) Except as provided in paragraph (2), an
employer of an EMT-I or EMT-II may conduct investigations, as
necessary, and take disciplinary action against an EMT-I or EMT-II
who is employed by that employer for conduct in violation of
subdivision (c). The employer shall notify the medical director of
the local EMS agency that has jurisdiction in the county in which the
alleged violation occurred within three days when an allegation has
been validated as a potential violation of subdivision (c).
   (B) Each employer of an EMT-I or EMT-II employee shall notify the
medical director of the local EMS agency that has jurisdiction in the
county in which a violation related to subdivision (c) occurred
within three days after the EMT-I or EMT-II is terminated or
suspended for a disciplinary cause, the EMT-I or EMT-II resigns
following notification of an impending investigation based upon
evidence that would indicate the existence of a disciplinary cause,
or the EMT-I or EMT-II is removed from EMT-related duties for a
disciplinary cause after the completion of the employer's
investigation.
   (C) At the conclusion of an investigation, the employer of an
EMT-I or EMT-II may develop and implement, in accordance with the
guidelines for disciplinary orders, temporary suspensions, and
conditions of probation adopted pursuant to Section 1797.184, a
disciplinary plan for the EMT-I or EMT-II. Upon adoption of the
disciplinary plan, the employer shall submit that plan to the local
EMS agency within three working days. The employer's disciplinary
plan may include a recommendation that the medical director of the
local EMS agency consider taking action against the holder's
certificate pursuant to paragraph (3).
   (2) If an EMT-I or EMT-II is not employed by an ambulance service
licensed by the Department of the California Highway Patrol or a
public safety agency or if that ambulance service or public safety
agency chooses not to conduct an investigation pursuant to paragraph
(1) for conduct in violation of subdivision (c), the medical director
of a local EMS agency shall conduct the investigations, and, upon a
determination of disciplinary cause, take disciplinary action as
necessary against the EMT-I or EMT-II. At the conclusion of these
investigations, the medical director shall develop and implement, in
accordance with the recommended guidelines for disciplinary orders,
temporary orders, and conditions of probation adopted pursuant to
Section 1797.184, a disciplinary plan for the EMT-I or EMT-II. The
medical director's disciplinary plan may include action against the
holder's certificate pursuant to paragraph (3).
   (3) The medical director of the local EMS agency may, upon a
determination of disciplinary cause and in accordance with
regulations for disciplinary processes adopted pursuant to Section
1797.184, deny, suspend, or revoke any EMT-I or EMT-II certificate
issued under this division, or may place any EMT-I or EMT-II
certificate holder on probation, upon the finding by that medical
director of the occurrence of any of the actions listed in
subdivision (c) and the occurrence of one of the following:
   (A) The EMT-I or EMT-II employer, after conducting an
investigation, failed to impose discipline for the conduct under
investigation, or the medical director makes a determination that the
discipline imposed was not according to the guidelines for
disciplinary orders and conditions of probation and the conduct of
the EMT-I or EMT-II certificate holder constitutes grounds for
disciplinary action against the certificate.
   (B) Either the employer of an EMT-I or EMT-II further determines,
after an investigation conducted under paragraph (1), or the medical
director determines after an investigation conducted under paragraph
(2), that the conduct requires disciplinary action against the
certificate.
   (4) The medical director of the local EMS agency, after
consultation with the employer of an EMT-I or EMT-II, may temporarily
suspend, prior to a hearing, any EMT-I or EMT-II certificate or both
EMT-I and                                              EMT-II
certificates upon a determination that both of the following
conditions have been met:
   (A) The certificate holder has engaged in acts or omissions that
constitute grounds for revocation of the EMT-I or EMT-II certificate.

   (B) Permitting the certificate holder to continue to engage in the
certified activity without restriction would pose an imminent threat
to the public health or safety.
   (5) If the medical director of the local EMS agency temporarily
suspends a certificate, the local EMS agency shall notify the
certificate holder that his or her EMT-I or EMT-II certificate is
suspended and shall identify the reasons therefor. Within three
working days of the initiation of the suspension by the local EMS
agency, the agency and employer shall jointly investigate the
allegation in order for the agency to make a determination of the
continuation of the temporary suspension. All investigatory
information not otherwise protected by law held by the agency and
employer shall be shared between the parties via facsimile
transmission or overnight mail relative to the decision to
temporarily suspend. The local EMS agency shall decide, within 15
calendar days, whether to serve the certificate holder with an
accusation pursuant to Chapter 5 (commencing with Section 11500) of
Part 1 of Division 3 of Title 2 of the Government Code. If the
certificate holder files a notice of defense, the hearing shall be
held within 30 days of the local EMS agency's receipt of the notice
of defense. The temporary suspension order shall be deemed vacated if
the local EMS agency fails to make a final determination on the
merits within 15 days after the administrative law judge renders the
proposed decision.
   (6) The medical director of the local EMS agency shall refer, for
investigation and discipline, any complaint received on an EMT-I or
EMT-II to the relevant employer within three days of receipt of the
complaint, pursuant to subparagraph (A) of paragraph (1) of
subdivision (a).
   (b) The authority may deny, suspend, or revoke any EMT-P license
issued under this division, or may place any EMT-P license issued
under this division, or may place any EMT-P licenseholder on
probation upon the finding by the director of the occurrence of any
of the actions listed in subdivision (c). Proceedings against any
EMT-P license or licenseholder shall be held in accordance with
Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of
Title 2 of the Government Code.
   (c) Any of the following actions shall be considered evidence of a
threat to the public health and safety and may result in the denial,
suspension, or revocation of a certificate or license issued under
this division, or in the placement on probation of a certificate
holder or licenseholder under this division:
   (1) Fraud in the procurement of any certificate or license under
this division.
   (2) Gross negligence.
   (3) Repeated negligent acts.
   (4) Incompetence.
   (5) The commission of any fraudulent, dishonest, or corrupt act
that is substantially related to the qualifications, functions, and
duties of prehospital personnel.
   (6) Conviction of any crime which is substantially related to the
qualifications, functions, and duties of prehospital personnel. The
record of conviction or a certified copy of the record shall be
conclusive evidence of the conviction.
   (7) Violating or attempting to violate directly or indirectly, or
assisting in or abetting the violation of, or conspiring to violate,
any provision of this division or the regulations adopted by the
authority pertaining to prehospital personnel.
   (8) Violating or attempting to violate any federal or state
statute or regulation that regulates narcotics, dangerous drugs, or
controlled substances.
   (9) Addiction to, the excessive use of, or the misuse of,
alcoholic beverages, narcotics, dangerous drugs, or controlled
substances.
   (10) Functioning outside the supervision of medical control in the
field care system operating at the local level, except as authorized
by any other license or certification.
   (11) Demonstration of irrational behavior or occurrence of a
physical disability to the extent that a reasonable and prudent
person would have reasonable cause to believe that the ability to
perform the duties normally expected may be impaired.
   (12) Unprofessional conduct exhibited by any of the following:
   (A) The mistreatment or physical abuse of any patient resulting
from force in excess of what a reasonable and prudent person trained
and acting in a similar capacity while engaged in the performance of
his or her duties would use if confronted with a similar
circumstance. Nothing in this section shall be deemed to prohibit an
EMT-I, EMT-II, or EMT-P from assisting a peace officer, or a peace
officer who is acting in the dual capacity of peace officer and
EMT-I, EMT-II, or EMT-P, from using that force that is reasonably
necessary to effect a lawful arrest or detention.
   (B) The failure to maintain confidentiality of patient medical
information, except as disclosure is otherwise permitted or required
by law in Part 2.6 (commencing with Section 56) of Division 1 of the
Civil Code.
   (C) The commission of any sexually related offense specified under
Section 290 of the Penal Code.
   (d) The information shared among EMT-I, EMT-II, and EMT-P
employers, medical directors of local EMS agencies, the authority,
and EMT-I and EMT-II certifying entities shall be deemed to be an
investigative communication that is exempt from public disclosure as
a public record pursuant to subdivision (f) of Section 6254 of the
Government Code. A formal disciplinary action against an EMT-I,
EMT-II, or EMT-P shall be considered a public record available to the
public, unless otherwise protected from disclosure pursuant to state
or federal law.
   (e) For purposes of this section, "disciplinary cause" means an
act that is substantially related to the qualifications, functions,
and duties of an EMT-I, EMT-II, or EMT-P and is evidence of a threat
to the public health and safety described in subdivision (c).
  SEC. 128.  Section 13221 of the Health and Safety Code is amended
to read:
   13221.  The State Fire Marshal shall adopt regulations for the
furnishing of emergency procedure information according to this
chapter. Those regulations may include the general contents of
brochures, pamphlets, signs, or video recordings used in furnishing
emergency procedure information, but shall provide for at least the
following:
   (a) A reference to the posting of exit plans for the structure.
   (b) A general explanation of the operation of the fire alarm
system of the structure.
   (c) Other fire emergency procedures.
  SEC. 129.  Section 25396 of the Health and Safety Code is amended
to read:
   25396.  Unless the context indicates otherwise, the following
definitions govern the construction of this chapter.
   (a) "Affected community" means the local residents or workers
living or working, and owners of businesses operating, in proximity
to the site, who are, or may be, directly impacted by the conditions
at the site, or by any response action. "Affected community" also
includes the legislative body of the jurisdiction in which a site is
located.
   (b) "Agency" means the California Environmental Protection Agency.

   (c) "Arbitration panel" means the arbitration panel convened
pursuant to Section 25398.10.
   (d) "Beneficial uses of water" means uses of the waters of the
state that are identified in the current State Water Resources
Control Board and California regional water quality control boards'
water quality control plans for the area in which the site is
located.
   (e) "Department" means the Department of Toxic Substances Control.

   (f) "Engineering controls" means measures to control or contain
migration of hazardous substances or to prevent, minimize, or
mitigate environmental damage which may otherwise result from a
release or threatened release, including, but not limited to, caps,
covers, dikes, trenches, leachate collection systems, treatment
systems, and groundwater containment systems or procedures.
   (g) "Federal act" means the Comprehensive Environmental Response,
Compensation, and Liability Act, as amended (42 U.S.C. Sec. 9601 et
seq.).
   (h) "Fund administrator" means the state officer assigned the
responsibility of protecting the viability of the trust fund as the
representative of the state for the orphan share in all actions
concerning apportionment of liability if there is a potential
apportionment of liability to the orphan share for payment from the
trust fund.
   (i) "Hazardous substance" shall have the same meaning as set forth
in Sections 25316 and 25317.
   (j) (1) "Insolvent" means a person or entity who has received a
discharge of liability under Section 727, 944, 1141, 1228, or 1328 of
Title 11 of the United States Code, for prepetition response costs
relating to a site selected for response actions pursuant to this
chapter.
   (2) Notwithstanding paragraph (1), a person or entity is not
insolvent with respect to any payment that the department receives or
will receive for any prepetition response costs as a result of the
bankruptcy, or with respect to any postpetition response costs.
   (k) "Interim endangerment" means conditions at a site which pose a
significant risk either of harm to human health or of serious
environmental damage unless immediate response action is initiated
before remedial action measures set forth in a remedial action plan
prepared for the site are implemented.
   (  l  ) "Land use controls" means recorded instruments
restricting the present and future uses of the site, including, but
not limited to, recorded easements, covenants, restrictions, or
servitudes, or any combination thereof, as appropriate. Land use
controls shall run with the land from the date of recordation, shall
bind all of the owners of the land, and their heirs, successors, and
assignees, and the agents, employees, and lessees of the owners,
heirs, successors, and assignees, and shall be enforceable by the
department pursuant to Article 8 (commencing with Section 25180) of
Chapter 6.5.
   (m) "Orphan share" means that share of liability for the costs of
response actions apportioned to responsible persons who are insolvent
or cannot be identified or located. The department may adopt
regulations to further define a process to determine when a
responsible person cannot be identified or located.
   (n) "Person" shall have the same meaning as set forth in Section
25319.
   (o) "Planned use" means the reasonably expected future land uses
based on all of the following factors:
   (1) The land use history of the site and surrounding properties,
the current land uses of the site and surrounding properties and
recent development patterns in the area where the site is located.
   (2) Land use designations at the site and surrounding properties,
including current and likely future zoning and local land use plans
and the presence, if any, of groundwater and surface water recharge
areas.
   (3) The potential for economic redevelopment.
   (4) Current plans for the site by the property owner or owners.
   (5) Affected community comments on the proposals for use of the
site.
   (p) "Release" has the same meaning as set forth in Sections 25320
and 25321.
   (q) "Remedy" or "remedial action" means actions that are necessary
to prevent, minimize, or mitigate damage that may result from a
release or threatened release of a hazardous substance and that, when
carried through to completion, allow a site to be permanently used
for its planned use without any significant risk to human health or
any significant potential for future environmental damage. "Remedy"
or "remedial action" includes, but is not limited to, all of the
following:
   (1) Actions at the location of the release, such as storage;
confinement; perimeter protection using dikes, trenches, or ditches;
clay cover; neutralization; cleanup of released hazardous substances
and associated contaminated materials; recycling, reuse, diversion,
destruction, or segregation of reactive wastes; dredging, excavation,
repair, or replacement of leaking containers; collection of leachate
and runoff; onsite treatment or incineration; provision of
alternative water supplies; and any monitoring reasonably required to
ensure that these actions protect human health and safety, or the
environment.
   (2) The costs of permanent relocation of residents and businesses
and community facilities where the Governor determines that, alone or
in combination with other measures, that relocation is more cost
effective than, and environmentally preferable to, the
transportation, storage, treatment, destruction, or secure
disposition offsite of hazardous substances, or may otherwise be
necessary to protect human health and safety, or the environment.
   (3) Offsite transport and offsite storage, treatment, destruction,
or secure disposition of hazardous substances and associated
contaminated materials.
   (r) "Remove" or "removal" means the cleanup or removal of released
hazardous substances from the environment; those actions that may be
necessarily taken in the event of the threat or release of hazardous
substances into the environment; those actions that may be necessary
to monitor, assess, and evaluate the release, or threat of release,
of hazardous substances; the disposal of removed material; and the
taking of other actions which may be necessary to prevent, minimize,
or mitigate damage to human health and safety, or the environment,
that may otherwise result from a release or threat of release.
"Remove" or "removal" also includes, but is not limited to, security
fencing or other measures to limit access, provision of alternative
water supplies, and temporary evacuation and housing of threatened
individuals not otherwise provided.
   (s) "Respond," "response," or "response action" means removal
actions, and remedial actions, including, but not limited to,
operation and maintenance measures.
   (t) "Response costs" means all costs incurred by the state or a
responsible person in taking response actions under this chapter at a
specific site, including costs incurred by a state agency in
implementing and administering this chapter pursuant to the
limitations established in subdivision (f) of Section 25399, and in
overseeing response actions under this chapter. Those costs shall
include all costs incurred by the state in relation to any judicial
review of a decision of an arbitration panel pursuant to subdivision
(e) of Section 25398.10 or any arbitration conducted pursuant to this
chapter.
   (u) "Responsible person" has the same meaning as set forth in
Section 25323.5 for "responsible party" or "liable person."
   (v) "Secretary" means the Secretary for Environmental Protection.
   (w) "Site" means any building, structure, installation, equipment,
pipe or pipeline (including any pipe into a sewer or publicly owned
treatment works), well, pit, pond, lagoon, impoundment, ditch,
landfill, storage container, motor vehicle, rolling stock, or
aircraft, or any area where a hazardous substance has been deposited,
stored, disposed of, or placed, or otherwise come to be located; but
does not include any consumer product in consumer use or any vessel.

   (x) "Site Designation Committee" or "committee" means the Site
Designation Committee created pursuant to Section 25261.
   (y) "State board" means the State Water Resources Control Board.
   (z) "Trust fund" means the Expedited Site Remediation Trust Fund
created pursuant to subdivision (a) of Section 25399.1.
  SEC. 130.  Section 44272 of the Health and Safety Code is amended
to read:
   44272.  (a) The Alternative and Renewable Fuel and Vehicle
Technology Program is hereby created. The program shall be
administered by the commission. The commission shall implement the
program by regulation pursuant to the requirements of Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3 of Title 2 of
the Government Code. The program shall provide, upon appropriation
by the Legislature, competitive grants, revolving loans, loan
guarantees, loans, or other appropriate funding measures, to public
agencies, vehicle and technology entities, businesses and projects,
public-private partnerships, workforce training partnerships and
collaboratives, fleet owners, consumers, recreational boaters, and
academic institutions to develop and deploy innovative technologies
that transform California's fuel and vehicle types to help attain the
state's climate change policies. The emphasis of this program shall
be to develop and deploy technology and alternative and renewable
fuels in the marketplace, without adopting any one preferred fuel or
technology.
   (b) A project funded by the commission shall be approved at a
noticed public hearing of the commission and shall be consistent with
the priorities established by the investment plan adopted pursuant
to Section 44272.5.
   (c) The commission shall provide preferences to those projects
that maximize the goals of the Alternative and Renewable Fuel and
Vehicle Technology Program, based on the following criteria, as
applicable:
   (1) The project's ability to provide a measurable transition from
the nearly exclusive use of petroleum fuels to a diverse portfolio of
viable alternative fuels that meet petroleum reduction and
alternative fuel use goals.
   (2) The project's consistency with existing and future state
climate change policy and low-carbon fuel standards.
   (3) The project's ability to reduce criteria air pollutants and
air toxics and reduce or avoid multimedia environmental impacts.
   (4) The project's ability to decrease, on a life-cycle basis, the
discharge of water pollutants or any other substances known to damage
human health or the environment, in comparison to the production and
use of California Phase 2 Reformulated Gasoline or diesel fuel
produced and sold pursuant to California diesel fuel regulations set
forth in Article 2 (commencing with Section 2280) of Chapter 5 of
Division 3 of Title 13 of the California Code of Regulations.
   (5) The project does not adversely impact the sustainability of
the state's natural resources, especially state and federal lands.
   (6) The project provides nonstate matching funds.
   (7) The project provides economic benefits for California by
promoting California-based technology firms, jobs, and businesses.
   (8) The project uses existing or proposed fueling infrastructure
to maximize the outcome of the project.
   (9) The project's ability to reduce on a life cycle assessment
greenhouse gas emissions by at least 10 percent, and higher
percentages in the future, from current reformulated gasoline and
diesel fuel standards established by the state board.
   (10) The project's use of alternative fuel blends of at least 20
percent, and higher blend ratios in the future, with a preference for
projects with higher blends.
   (11) The project drives new technology advancement for vehicles,
vessels, engines, and other equipment, and promotes the deployment of
that technology in the marketplace.
   (d) Only the following shall be eligible for funding:
   (1) Alternative and renewable fuel projects to develop and improve
alternative and renewable low-carbon fuels, including electricity,
ethanol, dimethyl ether, renewable diesel, natural gas, hydrogen, and
biomethane, among others, and their feedstocks that have high
potential for long-term or short-term commercialization, including
projects that lead to sustainable feedstocks.
   (2) Demonstration and deployment projects that optimize
alternative and renewable fuels for existing and developing engine
technologies.
   (3) Projects to produce alternative and renewable low-carbon fuels
in California.
   (4) Projects to decrease the overall impact of an alternative and
renewable fuel's life cycle carbon footprint and increase
sustainability.
   (5) Alternative and renewable fuel infrastructure, fueling
stations, and equipment. The preference in paragraph (10) of
subdivision (c) shall not apply to renewable diesel or biodiesel
infrastructure, fueling stations, and equipment used solely for
renewable diesel or biodiesel fuel.
   (6) Projects to develop and improve light-, medium-, and
heavy-duty vehicle technologies that provide for better fuel
efficiency and lower greenhouse gas emissions, alternative fuel usage
and storage, or emission reductions, including propulsion systems,
advanced internal combustion engines with a 40-percent or better
efficiency level over the current market standard, lightweight
materials, energy storage, control systems and system integration,
physical measurement and metering systems and software, development
of design standards and testing and certification protocols, battery
recycling and reuse, engine and fuel optimization electronic and
electrified components, hybrid technology, plug-in hybrid technology,
battery electric vehicle technology, fuel cell technology, and
conversions of hybrid technology to plug-in technology through the
installation of safety certified supplemental battery modules.
   (7) Programs and projects that accelerate the commercialization of
vehicles and alternative and renewable fuels including buy-down
programs through near-market and market-path deployments, advanced
technology warranty or replacement insurance, development of market
niches, supply-chain development, and research related to the
pedestrian safety impacts of vehicle technologies and alternative and
renewable fuels.
   (8) Programs and projects to retrofit medium- and heavy-duty
on-road and nonroad vehicle fleets with technologies that create
higher fuel efficiencies, including alternative and renewable fuel
vehicles and technologies, idle management technology, and
aerodynamic retrofits that decrease fuel consumption.
   (9) Infrastructure projects that promote alternative and renewable
fuel infrastructure development connected with existing fleets,
public transit, and existing transportation corridors, including
physical measurement or metering equipment and truck stop
electrification.
   (10) Workforce training programs related to alternative and
renewable fuel feedstock production and extraction, renewable fuel
production, distribution, transport, and storage, high-performance
and low-emission vehicle technology and high tower electronics,
automotive computer systems, mass transit fleet conversion,
servicing, and maintenance, and other sectors or occupations related
to the purposes of this chapter.
   (11) Block grants administered by not-for-profit technology
entities for multiple projects, education and program promotion
within California, and development of alternative and renewable fuel
and vehicle technology centers.
   (12) Life cycle and multimedia analyses, sustainability and
environmental impact evaluations, and market, financial, and
technology assessments performed by a state agency to determine the
impacts of increasing the use of low-carbon transportation fuels and
technologies, and to assist in the preparation of the investment plan
and program implementation.
   (e) The commission may make a single source or sole source award
pursuant to this section for applied research. The same requirements
set forth in Section 25620.5 of the Public Resources Code shall apply
to awards made on a single source basis or a sole source basis. This
subdivision does not authorize the commission to make a single
source or sole source award for a project or activity other than for
applied research.
   (f) Until January 1, 2012, the commission may contract with the
Treasurer to expend funds through programs implemented by the
Treasurer, if that expenditure is consistent with all of the
requirements of this chapter.
  SEC. 131.  Section 50843.5 of the Health and Safety Code is amended
to read:
   50843.5.  (a) Subject to the availability of funding, the
department shall make matching grants available to cities, counties,
cities and counties, and charitable nonprofit organizations organized
under Section 501(c)(3) of the Internal Revenue Code that have
created and are operating or will operate housing trust funds. These
funds shall be awarded through the issuance of a Notice of Funding
Availability (NOFA).
   (1) Applicants that provide matching funds from a source or
sources other than impact fees on residential development shall
receive a priority for funding.
   (2) The department shall set aside funding for new trusts, as
defined by the department in the NOFA.
   (b) Housing trusts eligible for funding under this section shall
have the following characteristics:
   (1) Utilization of a public or joint public and private fund
established by legislation, ordinance, resolution, or a
public-private partnership to receive specific revenue to address
local housing needs.
   (2) Receipt of ongoing revenues from dedicated sources of funding
such as taxes, fees, loan repayments, or private contributions.
   (c) The minimum allocation to an applicant that is a newly
established trust, and is in a county with a population that conforms
with paragraph (2) of subdivision (c) of Section 53545.9, shall be
five hundred thousand dollars ($500,000). The minimum allocation for
all other trusts shall be one million dollars ($1,000,000). No
applicant may receive an allocation in excess of two million dollars
($2,000,000). All funds provided pursuant to this section shall be
matched on a dollar-for-dollar basis with moneys that are not
required by any state or federal law to be spent on housing. No
application for an existing housing trust shall be considered unless
the department has received adequate documentation of the deposit in
the local housing trust fund of the local match and the identity of
the source of matching funds. An application for a new trust shall
not be considered unless the department has received adequate
documentation, as determined by the department, that an ordinance
imposing or dedicating a tax or fee to be deposited into the new
trust has been enacted or the applicant has adopted a legally binding
commitment to deposit matching funds into the new trust. Funds shall
not be disbursed by the department to any trust until all matching
funds are on deposit and then funds may be disbursed only in amounts
necessary to fund projects identified to receive a loan from the
trust within a reasonable period of time, as determined by the
department. Applicants shall be required to continue funding the
local housing trust fund from these identified local sources, and
continue the trust in operation, for a period of no less than five
years from the date of award. If the funding is not continued for a
five-year period, then (1) the amount of the department's grant to
the                                             local housing trust
fund, to the extent that the trust fund has unencumbered funds
available, shall be immediately repaid, and (2) any payments from any
projects funded by the local housing trust fund that would have been
paid to the local housing trust fund shall be paid instead to the
department and used for the program or its successor. The total
amount paid to the department pursuant to (1) and (2), combined,
shall not exceed the amount of the department's grant.
   (d) (1) Funds shall be used for the predevelopment costs,
acquisition, construction, or rehabilitation of the following types
of housing or projects:
   (A) Rental housing projects or units within rental housing
projects. The affordability of all assisted units shall be restricted
for not less than 55 years.
   (B) Emergency shelters, Safe Havens, and transitional housing, as
these terms are defined in Section 50801.
   (C) For sale housing projects or units within for sale housing
projects.
   (2) At least 30 percent of the total amount of the grant and the
match shall be expended on projects, units, or shelters that are
affordable to, and restricted for, extremely low income persons and
families, as defined in Section 50106. No more than 20 percent of the
total amount of the grant and the match shall be expended on
projects or units affordable to, and restricted for, moderate-income
persons and families whose income does not exceed 120 percent of the
area median income. The remaining funds shall be used for projects,
units, or shelters that are affordable to, and restricted for, lower
income persons and families, as defined in Section 50079.5.
   (3) If funds are used for the acquisition, construction, or
rehabilitation of for sale housing projects or units within for sale
housing projects, the grantee shall record a deed restriction against
the property that will ensure compliance with one of the following
requirements upon resale of the for sale housing units, unless it is
in conflict with the requirements of another public funding source or
law:
   (A) If the property is sold within 30 years from the date that
trust funds are used to acquire, construct, or rehabilitate the
property, the owner or subsequent owner shall sell the home at an
affordable housing cost, as described in Section 50052.5, to a
household that meets the relevant income qualifications.
   (B) The owner and grantee shall share the equity in the unit
pursuant to an equity sharing agreement. The grantee shall reuse the
proceeds of the equity sharing agreement consistent with this
section. To the extent not in conflict with another public funding
source or law, all of the following shall apply to the equity-sharing
agreement provided for by the deed restriction:
   (i) Upon resale by an owner-occupant of the home, the
owner-occupant of the home shall retain the market value of any
improvements, the downpayment, and his or her proportionate share of
appreciation. The grantee shall recapture any initial subsidy and its
proportionate share of appreciation, which shall then be used to
make housing available to persons and families of the same income
category as the original grant and for any type of housing or shelter
specified in paragraph (1).
   (ii) For purposes of this subdivision, the initial subsidy shall
be equal to the fair market value of the home at the time of initial
sale to the owner-occupant minus the initial sale price to the
owner-occupant, plus the amount of any downpayment assistance or
mortgage assistance. If upon resale by the owner-occupant the market
value is lower than the initial market value, the value at the time
of the resale shall be used as the initial market value.
   (iii) For purposes of this subdivision, the grantee's
proportionate share of appreciation shall be equal to the ratio of
the initial subsidy to the fair market value of the home at the time
of the initial sale.
   (e) Loan repayments shall accrue to the grantee housing trust for
use pursuant to this section. If the trust no longer exists, loan
repayments shall accrue to the department for use in the program or
its successor.
   (f) (1) In order for a city, county, or city and county to be
eligible for funding, the applicant shall, at the time of
application, meet both of the following requirements:
   (A) Have an adopted housing element that the department has
determined, pursuant to Section 65585 of the Government Code, is in
substantial compliance with the requirements of Article 10.6
(commencing with Section 65580) of Chapter 3 of Division 1 of Title 7
of the Government Code.
   (B) Have submitted to the department the annual progress report
required by Section 65400 of the Government Code within the preceding
12 months, if the department has adopted the forms and definitions
pursuant to subparagraph (B) of paragraph (2) of subdivision (a) of
Section 65400 of the Government Code.
   (2) In order for a nonprofit organization applicant to be eligible
for funding, the applicant shall agree to utilize funds provided
under this chapter only for projects located in cities, counties, or
a city and county that, at the time of application, meet both of the
following requirements:
   (i) Have an adopted housing element that the department has
determined, pursuant to Section 65585 of the Government Code, to be
in substantial compliance with the requirements of Article 10.6
(commencing with Section 65580) of Chapter 3 of Division 1 of Title 7
of the Government Code.
   (ii) Have submitted to the department the annual progress report
required by Section 65400 of the Government Code within the preceding
12 months, if the department has adopted the forms and definitions
pursuant to subparagraph (B) of paragraph (2) of subdivision (a) of
Section 65400 of the Government Code.
   (g) Recipients shall have held, or shall agree to hold, a public
hearing or hearings to discuss and describe the project or projects
that will be financed with funds provided pursuant to this section.
As a condition of receiving a grant pursuant to this section, any
nonprofit organization shall agree that it will hold one public
meeting a year to discuss the criteria that will be used to select
projects to be funded. That meeting shall be open to the public, and
public notice of this meeting shall be provided, except to the extent
that any similar meeting of a city or county would be permitted to
be held in closed session.
   (h) No more than 5 percent of the funds appropriated to the
department for the purposes of this program shall be used to pay the
costs of administration of this section.
   (i) A local housing trust fund shall encumber funds provided
pursuant to this section no later than 36 months after receipt. Any
funds not encumbered within that period shall revert to the
department for use in the program or its successor.
   (j) Recipients shall be required to file periodic reports with the
department regarding the use of funds provided pursuant to this
section. No later than December 31 of each year in which funds are
awarded by the program, the department shall provide a report to the
Legislature regarding the number of trust funds created, a
description of the projects supported, the number of units assisted,
and the amount of matching funds received.
  SEC. 132.  Section 103526.5 of the Health and Safety Code is
amended to read:
   103526.5.  (a) Each certified copy of a birth, death, or marriage
record issued pursuant to Section 103525 shall include the date
issued, the name of the issuing officer, the signature of the issuing
officer, whether that is the State Registrar, local registrar,
county recorder, or county clerk, or an authorized facsimile thereof,
and the seal of the issuing office.
   (b) All certified copies of birth, death, and marriage records
issued pursuant to Section 103525 shall be printed on chemically
sensitized security paper that measures 81/2 inches by 11 inches and
that has the following features:
   (1) Intaglio print.
   (2) Latent image.
   (3) Fluorescent, consecutive numbering with matching barcode.
   (4) Microprint line.
   (5) Prismatic printing.
   (6) Watermark.
   (7) Void pantograph.
   (8) Fluorescent security threads.
   (9) Fluorescent fibers.
   (10) Any other security features deemed necessary by the State
Registrar.
   (c) The State Registrar, local registrars, county recorders, and
county clerks shall take precautions to ensure that uniform and
consistent standards are used statewide to safeguard the security
paper described in subdivision (b), including, but not limited to,
the following measures:
   (1) Security paper shall be maintained under secure conditions so
as not to be accessible to the public.
   (2) A log shall be kept of all visitors allowed in the area where
security paper is stored.
   (3) All spoilage shall be accounted for and subsequently destroyed
by shredding on the premises.
  SEC. 133.  Section 112877 of the Health and Safety Code, as amended
by Section 120 of Chapter 140 of the Statutes of 2009, is repealed.
  SEC. 134.  Section 114850 of the Health and Safety Code is amended
to read:
   114850.  As used in this chapter:
   (a) "Department" means the State Department of Public Health.
   (b) "Committee" means the Radiologic Technology Certification
Committee.
   (c) "Radiologic technology" means the application of X-rays on
human beings for diagnostic or therapeutic purposes.
   (d) "Radiologic technologist" means any person, other than a
licentiate of the healing arts, making application of X-rays to human
beings for diagnostic or therapeutic purposes pursuant to
subdivision (b) of Section 114870.
   (e) "Limited permit" means a permit issued pursuant to subdivision
(c) of Section 114870 to persons to conduct radiologic technology
limited to the performance of certain procedures or the application
of X-rays to specific areas of the human body, except for a
mammogram.
   (f) "Approved school for radiologic technologists" means a school
that the department has determined provides a course of instruction
in radiologic technology that is adequate to meet the purposes of
this chapter.
   (g) "Supervision" means responsibility for, and control of,
quality, radiation safety, and technical aspects of all X-ray
examinations and procedures.
   (h) (1) "Licentiate of the healing arts" means a person licensed
under the provisions of the Medical Practice Act, the provisions of
the initiative act entitled "An act prescribing the terms upon which
licenses may be issued to practitioners of chiropractic, creating the
State Board of Chiropractic Examiners and declaring its powers and
duties, prescribing penalties for violation thereof, and repealing
all acts and parts of acts inconsistent herewith," approved by
electors November 7, 1922, as amended, or the Osteopathic Act.
   (2) For purposes of Section 114872, a licentiate of the healing
arts means a person licensed under the Physician Assistant Practice
Act (Chapter 7.7 (commencing with Section 3500) of Division 2 of the
Business and Professions Code) who practices under the supervision of
a qualified physician and surgeon pursuant to the act and pursuant
to Division 13.8 of Title 16 of the California Code of Regulations.
   (i) "Certified supervisor or operator" means a licentiate of the
healing arts who has been certified under subdivision (e) of Section
114870 or 107111 to supervise the operation of X-ray machines or to
operate X-ray machines, or both.
   (j) "Student of radiologic technology" means a person who has
started and is in good standing in a course of instruction that, if
completed, would permit the person to be certified a radiologic
technologist or granted a limited permit upon satisfactory completion
of any examination required by the department. "Student of
radiologic technology" does not include any person who is a student
in a school of medicine, chiropractic, podiatry, dentistry, dental
radiography, or dental hygiene.
   (k) "Mammogram" means an X-ray image of the human breast.
   (l) "Mammography" means the procedure for creating a mammogram.
  SEC. 135.  Section 116064.2 of the Health and Safety Code is
amended to read:
   116064.2.  (a) As used in this section, the following words have
the following meanings:
   (1) "ASME/ANSI performance standard" means a standard that is
accredited by the American National Standards Institute and published
by the American Society of Mechanical Engineers.
   (2) "ASTM performance standard" means a standard that is developed
and published by ASTM International.
   (3) "Main drain" means a submerged suction outlet typically
located at the bottom of a swimming pool that conducts water to a
recirculating pump.
   (4) "Public swimming pool" means an outdoor or indoor structure,
whether in-ground or above-ground, intended for swimming or
recreational bathing, including a swimming pool, hot tub, spa, or
nonportable wading pool, that is any of the following:
   (A) Open to the public generally, whether for a fee or free of
charge.
   (B) Open exclusively to members of an organization and their
guests, residents of a multiunit apartment building, apartment
complex, residential real estate development, or other multifamily
residential area, or patrons of a hotel or other public
accommodations facility.
   (C) Located on the premises of an athletic club, or public or
private school.
   (5) "Qualified individual" means a contractor who holds a current
valid license issued by the State of California or a professional
engineer licensed in the State of California who has experience
working on public swimming pools.
   (6) "Safety vacuum release system" means a vacuum release system
that ceases operation of the pump, reverses the circulation flow, or
otherwise provides a vacuum release at a suction outlet when a
blockage is detected.
   (7) "Skimmer equalizer line" means a suction outlet located below
the waterline and connected to the body of a skimmer that prevents
air from being drawn into the pump if the water level drops below the
skimmer weir. However, a skimmer equalizer line is not a main drain.

   (8) "Unblockable drain" means a drain of any size and shape that a
human body cannot sufficiently block to create a suction entrapment
hazard.
   (b) Subject to subdivision (c), an ASME/ANSI or ASTM performance
standard relating to antientrapment devices or systems or an
amendment or successor to, or later published edition of an ASME/ANSI
or ASTM performance standard relating to antientrapment devices or
systems shall become the applicable standard in California 90 days
after publication by ASME/ANSI or ASTM, respectively, provided that
the performance standard or amendment or successor to, or later
published edition is approved by the department within 90 days of the
publication of the performance standard by ASME/ANSI or ASTM,
respectively. Notwithstanding any other law, the department may
implement, interpret, or make specific the provisions of this section
by means of a policy letter or similar instruction and this action
by the department shall not be subject to the rulemaking requirements
of the Administrative Procedure Act (Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code).
   (c) Subject to subdivision (f), every public swimming pool shall
be equipped with antientrapment devices or systems that comply with
ASME/ANSI performance standard A112.19.8, as in effect December 31,
2009, or any applicable ASME/ANSI performance standard that has been
adopted by the department pursuant to subdivision (b).
   (d) Subject to subdivisions (e) and (f), every public swimming
pool with a single main drain that is not an unblockable drain shall
be equipped with at least one or more of the following devices or
systems that are designed to prevent physical entrapment by pool
drains:
   (1) A safety vacuum release system that has been tested by a
department-approved independent third party and found to conform to
ASME/ANSI performance standard A112.19.17, as in effect on December
31, 2009, or any applicable ASME/ANSI performance standard that has
been adopted by the department pursuant to subdivision (b), or ASTM
performance standard F2387, as in effect on December 31, 2009, or any
applicable ASTM performance standard that has been adopted by the
department pursuant to subdivision (b).
   (2) A suction-limiting vent system with a tamper-resistant
atmospheric opening, provided that it conforms to any applicable
ASME/ANSI or ASTM performance standard that has been adopted by the
department pursuant to subdivision (b).
   (3) A gravity drainage system that utilizes a collector tank,
provided that it conforms to any applicable ASME/ANSI or ASTM
performance standard that has been adopted by the department pursuant
to subdivision (b).
   (4) An automatic pump shut-off system tested by a
department-approved independent third party and found to conform to
any applicable ASME/ANSI or ASTM performance standard that has been
adopted by the department pursuant to subdivision (b).
   (5) Any other system that is deemed, in accordance with federal
law, to be equally effective as, or more effective than, the systems
described in paragraphs (1) to (4), inclusive, at preventing or
eliminating the risk of injury or death associated with pool drainage
systems.
   (e) Every public swimming pool constructed on or after January 1,
2010, shall have at least two main drains per pump that are
hydraulically balanced and symmetrically plumbed through one or more
"T" fittings, and that are separated by a distance of at least three
feet in any dimension between the drains. A public swimming pool
constructed on or after January 1, 2010, that meets the requirements
of this subdivision, shall be exempt from the requirements of
subdivision (d).
   (f) A public swimming pool constructed prior to January 1, 2010,
shall be retrofitted to comply with subdivisions (c) and (d) by no
later than July 1, 2010, except that no further retrofitting is
required for a public swimming pool that completed a retrofit between
December 19, 2007, and January 1, 2010, that complied with the
Virginia Graeme Baker Pool and Spa Safety Act (15 U.S.C. Sec. 8001 et
seq.) as in effect on the date of issue of the construction permit,
or for a nonportable wading pool that completed a retrofit prior to
January 1, 2010, that complied with state law on the date of issue of
the construction permit. A public swimming pool owner who meets the
exception described in this subdivision shall do one of the following
prior to September 30, 2010:
   (1) File the form issued by the department pursuant to subdivision
(g), as otherwise provided in subdivision (i).
   (2) (A) File a signed statement attesting that the required work
has been completed.
   (B) Provide a document containing the name and license number of
the qualified individual who completed the required work.
   (C) Provide either a copy of the final building permit, if
required by the local agency, or a copy of one of the following
documents if no permit was required:
   (i) A document that describes the modification in a manner that
provides sufficient information to document the work that was done to
comply with federal law.
   (ii) A copy of the final paid invoice. The amount paid for the
services may be omitted or redacted from the final invoice prior to
submission.
   (g) Prior to March 31, 2010, the department shall issue a form for
use by an owner of a public swimming pool to indicate compliance
with this section. The department shall consult with county health
officers and directors of departments of environmental health in
developing the form and shall post the form on the department's
Internet Web site. The form shall be completed by the owner of a
public swimming pool prior to filing the form with the appropriate
city, county, or city and county department of environmental health.
The form shall include, but not be limited to, the following
information:
   (1) A statement of whether the pool operates with a single or
split main drain.
   (2) Identification of the type of antientrapment devices or
systems that have been installed pursuant to subdivision (c) and the
date or dates of installation.
   (3) Identification of the type of devices or systems designed to
prevent physical entrapment that have been installed pursuant to
subdivision (d) in a public swimming pool with a single main drain
that is not an unblockable drain and the date or dates of
installation or the reason why the requirement is not applicable.
   (4) A signature and license number of a qualified individual who
certifies that the factual information provided on the form in
response to paragraphs (1) to (3), inclusive, is true to the best of
his or her knowledge.
   (h) A qualified individual who improperly certifies information
pursuant to paragraph (4) of subdivision (g) shall be subject to
potential disciplinary action at the discretion of the licensing
authority.
   (i) Except as provided in subdivision (f), each public swimming
pool owner shall file a completed copy of the form issued by the
department pursuant to this section with the city, county, or city
and county department of environmental health in the city, county, or
city and county in which the swimming pool is located. The form
shall be filed within 30 days following the completion of the
swimming pool construction or installation required pursuant to this
section or, if the construction or installation is completed prior to
the date that the department issues the form pursuant to this
section, within 30 days of the date that the department issues the
form. The public swimming pool owner or operator shall not make a
false statement, representation, certification, record, report, or
otherwise falsify information that he or she is required to file or
maintain pursuant to this section.
   (j) In enforcing this section, health officers and directors of
city, county, or city and county departments of environmental health
shall consider documentation filed on or with the form issued
pursuant to this section by the owner of a public swimming pool as
evidence of compliance with this section. A city, county, or city and
county department of environmental health may verify the accuracy of
the information filed on or with the form.
   (k) To the extent that the requirements for public wading pools
imposed by Section 116064 conflict with this section, the
requirements of this section shall prevail.
   (l) (1) Until January 1, 2014, the department may assess an annual
fee on the owners of each public swimming pool, to be collected by
the applicable local health department, in an amount not to exceed
the amount necessary to defray the department's costs of carrying out
its duties under Section 116064.1 and this section but in no case
shall this fee exceed six dollars ($6).
   (2) The local health department may retain a portion of the fee
collected pursuant to paragraph (1) in an amount necessary to cover
the administrative costs of collecting the fee, but in no case to
exceed one dollar ($1).
   (3) The local health department shall bill the owner of each
public swimming pool in its jurisdiction for the amount of the state
fee. The local health department shall transmit the collected state
fee to the Controller for deposit into the Recreational Health Fund,
which is hereby created in the State Treasury. The local health
department shall not be required to take action to collect an unpaid
state fee, but shall submit to the department, every six months, a
list containing the name and address of the owner of each public
swimming pool who has failed to pay the state fee for more than 90
days after the date that the bill was provided to the owner of the
public swimming pool.
   (4) Owners that are exempt from local swimming pool permit fees
shall also be exempt from the fees imposed pursuant to this
subdivision.
   (5) Except as provided in paragraph (2), all moneys collected by
the department pursuant to this section shall be deposited into the
Recreational Health Fund. Notwithstanding Section 16305.7 of the
Government Code, interest and dividends on moneys in the Recreational
Health Fund shall also be deposited in the fund. Moneys in the fund
shall, upon appropriation by the Legislature, be available to the
department for carrying out its duties under Section 116064.1 and
this section and shall not be redirected for any other purpose.
  SEC. 136.  Section 116540 of the Health and Safety Code is amended
to read:
   116540.  Following completion of the investigation and
satisfaction of the requirements of subdivisions (a) and (b), the
department shall issue or deny the permit. The department may impose
permit conditions, requirements for system improvements, and time
schedules as it deems necessary to ensure a reliable and adequate
supply of water at all times that is pure, wholesome, potable, and
does not endanger the health of consumers.
   (a) No public water system that was not in existence on January 1,
1998, shall be granted a permit unless the system demonstrates to
the department that the water supplier possesses adequate financial,
managerial, and technical capability to ensure the delivery of pure,
wholesome, and potable drinking water. This section shall also apply
to any change of ownership of a public water system that occurs after
January 1, 1998.
   (b) No permit under this chapter shall be issued to an association
organized under Title 3 (commencing with Section 18000) of the
Corporations Code. This section shall not apply to unincorporated
associations that as of December 31, 1990, are holders of a permit
issued under this chapter.
  SEC. 137.  Section 124991 of the Health and Safety Code is amended
to read:
   124991.  (a) (1) The Birth Defects Monitoring Program, within the
State Department of Public Health, shall collect and store any
umbilical cord blood samples it receives from hospitals for storage
and research. For purposes of ensuring financial stability, the Birth
Defects Monitoring Program shall ensure that the following
conditions, alone or in combination, are met:
   (A) The fees paid by researchers pursuant to subdivision (c) shall
be used for, and be sufficient to cover the cost of, collecting and
storing blood samples, including umbilical cord blood samples.
   (B) The department receives confirmation that a researcher has
requested umbilical cord blood samples from the Birth Defects
Monitoring Program for research or has requested umbilical cord blood
samples to be included within a request for pregnancy or newborn
blood samples through the program and has provided satisfactory
evidence that adequate funding will be provided to the department
from the fees paid by the researcher for the request.

          (C) The department receives federal grant moneys to pay for
initial startup costs for the collection and storage of umbilical
cord blood samples.
   (2) The department may limit the number of umbilical cord blood
samples the program collects each year.
   (b) (1) All information relating to umbilical cord blood samples
collected and utilized by the department shall be confidential, and
shall be used solely for the purposes of the program, or, if approved
by the department, research. Access to confidential information
shall be limited to authorized persons who agree, in writing, to
maintain the confidentiality of that information. Notwithstanding any
other provision of law, when the blood samples specified in
subdivision (c), including those samples with any information
identifying the person from whom the samples were obtained, are
stored, processed, analyzed, or otherwise shared for research
purposes with nondepartment staff, those samples may be shared by the
program with department-authorized researchers for research
purposes, and department representatives approved by the department,
subject to the confidentiality and security requirements for
confidential information established in this section and in Section
103850.
   (2) The department shall maintain an accurate record of all
persons who are given confidential information pursuant to this
section, and any disclosure of confidential information shall be made
only upon written agreement that the information will be kept
confidential, used for its approved purpose, and not be further
disclosed.
   (3) A person who, in violation of a written agreement to maintain
confidentiality, discloses information provided pursuant to this
section, or who uses information provided pursuant to this section in
a manner other than as approved pursuant to this section may be
denied further access to confidential information maintained by the
department, and shall be subject to a civil penalty not exceeding one
thousand dollars ($1,000). The penalty provided in this section does
not limit or otherwise restrict a remedy, provisional or otherwise,
provided by law for the benefit of the department or a person covered
by this section.
   (c) In order to implement this section, the department shall
establish fees in an amount that shall not exceed the costs of
administering the program and the collection and storage of these
samples, which the department shall collect from researchers who have
been approved by the department and who seek to use the following
types of blood samples for research:
   (1) Umbilical cord blood.
   (2) Pregnancy blood collected by the Genetic Disease Screening
Program, and stored by the Birth Defects Monitoring Program.
   (3) Newborn blood collected by the Genetic Disease Screening
Program.
   (d) Fees collected pursuant to subdivision (c) shall be collected
by the department and deposited into the Birth Defects Monitoring
Program Fund, the Genetic Disease Testing Fund, created pursuant to
Section 124996, or the Cord Blood Banking Fund, which is hereby
created as a special fund in the State Treasury. The amount of fees
deposited into each of these funds shall be based on the program that
is providing those pregnancy blood samples, and the purpose for
which the blood sample was obtained. Notwithstanding any other
provision of law, the moneys in the Birth Defects Monitoring Program
Fund, the Genetic Disease Testing Fund, and the Cord Blood Banking
Fund that are collected pursuant to subdivision (c), may be used by
the department, upon appropriation by the Legislature, for the
purposes specified in subdivision (e).
   (e)  Moneys in those funds shall be used for the costs related to
data management, including data linkage and entry, and blood
collection, storage, retrieval, processing, inventory, and shipping.
   (f) The department shall comply with the existing requirements in
the Birth Defects Monitoring Program, as set forth in Chapter 1
(commencing with Section 103825) of Part 2 of Division 102.
   (g) The department, any entities approved by the department, and
researchers shall maintain the confidentiality of patient information
and blood samples in accordance with existing law and in the same
manner as other medical record information with patient
identification that they possess, and shall use the information only
for the following purposes:
   (1) Research to identify risk factors for children's and women's
diseases.
   (2) Research to develop and evaluate screening tests.
   (3) Research to develop and evaluate prevention strategies.
   (4) Research to develop and evaluate treatments.
   (h) (1) For purposes of ensuring the security of a donor's
personal information, before any blood samples are released pursuant
to this section for research purposes, the State Committee for the
Protection of Human Subjects (CPHS) shall determine if all of the
following criteria have been met:
   (A) The department, contractors, researchers, or other entities
approved by the department have provided a plan sufficient to protect
personal information from improper use and disclosures, including
sufficient administrative, physical, and technical safeguards to
protect personal information from reasonable anticipated threats to
the security or confidentiality of the information.
   (B) The department, contractors, researchers, or other entities
approved by the department have provided a sufficient plan to destroy
or return all personal information as soon as it is no longer needed
for the research activity, unless the program contractors,
researchers, or other entities approved by the department have
demonstrated an ongoing need for the personal information for the
research activity and have provided a long-term plan sufficient to
protect the confidentiality of that information.
   (C) The department, contractors, researchers, or other entities
approved by the department have provided sufficient written
assurances that the personal information will not be reused or
disclosed to a person or entity, or used in a manner not approved in
the research protocol, except as required by law or for authorized
oversight of the research activity.
   (2) As part of its review and approval of the research activity
for the purpose of protecting personal information held in agency
databases, CPHS shall accomplish at least all of the following:
   (A) Determine whether the requested personal information is needed
to conduct the research.
   (B) Permit access to personal information only if it is needed for
the research activity.
   (C) Permit access only to the minimum personal information
necessary for the research activity.
   (D) Require the assignment of unique subject codes that are not
derived from personal information in lieu of social security numbers
if the research can be conducted without social security numbers.
   (E) If feasible, and if cost, time, and technical expertise
permit, require the agency to conduct a portion of the data
processing for the researcher to minimize the release of personal
information.
   (i) In addition to the fees described in subdivision (c), the
department may bill a researcher for the costs associated with the
department's process of protecting personal information, including,
but not limited to, the department's costs for conducting a portion
of the data processing for the researcher, removing personal
information, encrypting or otherwise securing personal information,
or assigning subject codes.
   (j) This section does not prohibit the department from using its
existing authority to enter into written agreements to enable other
institutional review boards to approve research activities, projects
or classes of projects for the department, provided that the data
security requirements set forth in this section are satisfied.
  SEC. 138.  Section 128730 of the Health and Safety Code is amended
to read:
   128730.  (a) Effective January 1, 1986, the office shall be the
single state agency designated to collect the following health
facility or clinic data for use by all state agencies:
   (1) That data required by the office pursuant to Section 127285.
   (2) That data required in the Medi-Cal cost reports pursuant to
Section 14170 of the Welfare and Institutions Code.
   (3) Those data items formerly required by the California Health
Facilities Commission that are listed in Sections 128735 and 128740.
Information collected pursuant to subdivision (g) of Section 128735
and Sections 128736 and 128737 shall be made available to the State
Department of Health Care Services and the State Department of Public
Health. The departments shall ensure that the patient's rights to
confidentiality shall not be violated in any manner. The departments
shall comply with all applicable policies and requirements involving
review and oversight by the State Committee for the Protection of
Human Subjects.
   (b) The office shall consolidate any and all of the reports listed
under this section or Sections 128735 and 128740, to the extent
feasible, to minimize the reporting burdens on hospitals, provided,
however, that the office shall neither add nor delete data items from
the Hospital Discharge Abstract Data Record or the quarterly reports
without prior authorizing legislation, unless specifically required
by federal law or regulation or judicial decision.
  SEC. 139.  Section 130060 of the Health and Safety Code is amended
to read:
   130060.  (a) (1) After January 1, 2008, any general acute care
hospital building that is determined to be a potential risk of
collapse or pose significant loss of life shall only be used for
nonacute care hospital purposes. A delay in this deadline may be
granted by the office upon a demonstration by the owner that
compliance will result in a loss of health care capacity that may not
be provided by other general acute care hospitals within a
reasonable proximity. In its request for an extension of the
deadline, a hospital shall state why the hospital is unable to comply
with the January 1, 2008, deadline requirement.
   (2) Prior to granting an extension of the January 1, 2008,
deadline pursuant to this section, the office shall do all of the
following:
   (A) Provide public notice of a hospital's request for an extension
of the deadline. The notice, at a minimum, shall be posted on the
office's Internet Web site, and shall include the facility's name and
identification number, the status of the request, and the beginning
and ending dates of the comment period, and shall advise the public
of the opportunity to submit public comments pursuant to subparagraph
(C). The office shall also provide notice of all requests for the
deadline extension directly to interested parties upon request of the
interested parties.
   (B) Provide copies of extension requests to interested parties
within 10 working days to allow interested parties to review and
provide comment within the 45-day comment period. The copies shall
include those records that are available to the public pursuant to
the California Public Records Act (Chapter 3.5 (commencing with
Section 6250) of Division 7 of Title 1 of the Government Code).
   (C) Allow the public to submit written comments on the extension
proposal for a period of not less than 45 days from the date of the
public notice.
   (b) (1)  It is the intent of the Legislature, in enacting this
subdivision, to facilitate the process of having more hospital
buildings in substantial compliance with this chapter and to take
nonconforming general acute care hospital inpatient buildings out of
service more quickly.
   (2) The functional contiguous grouping of hospital buildings of a
general acute care hospital, each of which provides, as the primary
source, one or more of the hospital's eight basic services as
specified in subdivision (a) of Section 1250, may receive a five-year
extension of the January 1, 2008, deadline specified in subdivision
(a) of this section pursuant to this subdivision for both structural
and nonstructural requirements. A functional contiguous grouping
refers to buildings containing one or more basic hospital services
that are either attached or connected in a way that is acceptable to
the State Department of Health Care Services. These buildings may be
either on the existing site or a new site.
   (3) To receive the five-year extension, a single building
containing all of the basic services or at least one building within
the contiguous grouping of hospital buildings shall have obtained a
building permit prior to 1973 and this building shall be evaluated
and classified as a nonconforming, Structural Performance Category-1
(SPC-1) building. The classification shall be submitted to and
accepted by the Office of Statewide Health Planning and Development.
The identified hospital building shall be exempt from the requirement
in subdivision (a) until January 1, 2013, if the hospital agrees
that the basic service or services that were provided in that
building shall be provided, on or before January 1, 2013, as follows:

   (A) Moved into an existing conforming Structural Performance
Category-3 (SPC-3), Structural Performance Category-4 (SPC-4), or
Structural Performance Category-5 (SPC-5) and Non-Structural
Performance Category-4 (NPC-4) or Non-Structural Performance
Category-5 (NPC-5) building.
   (B) Relocated to a newly built compliant SPC-5 and NPC-4 or NPC-5
building.
   (C) Continued in the building if the building is retrofitted to a
SPC-5 and NPC-4 or NPC-5 building.
   (4) A five-year extension is also provided to a post-1973 building
if the hospital owner informs the Office of Statewide Health
Planning and Development that the building is classified as SPC-1,
SPC-3, or SPC-4 and will be closed to general acute care inpatient
service use by January 1, 2013. The basic services in the building
shall be relocated into a SPC-5 and NPC-4 or NPC-5 building by
January 1, 2013.
   (5) SPC-1 buildings, other than the building identified in
paragraph (3) or (4), in the contiguous grouping of hospital
buildings shall also be exempt from the requirement in subdivision
(a) until January 1, 2013. However, on or before January 1, 2013, at
a minimum, each of these buildings shall be retrofitted to a SPC-2
and NPC-3 building, or no longer be used for general acute care
hospital inpatient services.
   (c) On or before March 1, 2001, the office shall establish a
schedule of interim work progress deadlines that hospitals shall be
required to meet to be eligible for the extension specified in
subdivision (b). To receive this extension, the hospital building or
buildings shall meet the year 2002 nonstructural requirements.
   (d) A hospital building that is eligible for an extension pursuant
to this section shall meet the January 1, 2030, nonstructural and
structural deadline requirements if the building is to be used for
general acute care inpatient services after January 1, 2030.
   (e) Upon compliance with subdivision (b), the hospital shall be
issued a written notice of compliance by the office. The office shall
send a written notice of violation to hospital owners that fail to
comply with this section. The office shall make copies of these
notices available on its Internet Web site.
   (f) (1) A hospital that has received an extension of the January
1, 2008, deadline pursuant to subdivision (a) or (b) may request an
additional extension of up to two years for a hospital building that
it owns or operates and that meets the criteria specified in
paragraph (2), (3), or (5).
   (2) The office may grant the additional extension if the hospital
building subject to the extension meets all of the following
criteria:
   (A) The hospital building is under construction at the time of the
request for extension under this subdivision and the purpose of the
construction is to meet the requirements of subdivision (a) to allow
the use of the building as a general acute care hospital building
after the extension deadline granted by the office pursuant to
subdivision (a) or (b).
   (B) The hospital building plans were submitted to the office and
were deemed ready for review by the office at least four years prior
to the applicable deadline for the building. The hospital shall
indicate, upon submission of its plans, the SPC-1 building or
buildings that will be retrofitted or replaced to meet the
requirements of this section as a result of the project.
   (C) The hospital received a building permit for the construction
described in subparagraph (A) at least two years prior to the
applicable deadline for the building.
   (D) The hospital submitted a construction timeline at least two
years prior to the applicable deadline for the building demonstrating
the hospital's intent to meet the applicable deadline. The timeline
shall include all of the following:
   (i) The projected construction start date.
   (ii) The projected construction completion date.
   (iii) Identification of the contractor.
   (E) The hospital is making reasonable progress toward meeting the
timeline set forth in subparagraph (D), but factors beyond the
hospital's control make it impossible for the hospital to meet the
deadline.
   (3) The office may grant the additional extension if the hospital
building subject to the extension meets all of the following
criteria:
   (A) The hospital building is owned by a health care district that
has, as owner, received the extension of the January 1, 2008,
deadline, but where the hospital is operated by an unaffiliated
third-party lessee pursuant to a facility lease that extends at least
through December 31, 2009. The district shall file a declaration
with the office with a request for an extension stating that, as of
the date of the filing, the district has lacked, and continues to
lack, unrestricted access to the subject hospital building for
seismic planning purposes during the term of the lease, and that the
district is under contract with the county to maintain hospital
services when the hospital comes under district control. The office
shall not grant the extension if an unaffiliated third-party lessee
will operate the hospital beyond December 31, 2010.
   (B) The hospital building plans were submitted to the office and
were deemed ready for review by the office at least four years prior
to the applicable deadline for the building. The hospital shall
indicate, upon submission of its plans, the SPC-1 building or
buildings that will be retrofitted or replaced to meet the
requirements of this section as a result of the project.
   (C) The hospital received a building permit for the construction
described in subparagraph (B) by December 31, 2011.
   (D) The hospital submitted, by December 31, 2011, a construction
timeline for the building demonstrating the hospital's intent and
ability to meet the deadline of December 31, 2014. The timeline shall
include all of the following:
   (i) The projected construction start date.
   (ii) The projected construction completion date.
   (iii) Identification of the contractor.
   (E) The hospital building is under construction at the time of the
request for the extension, the purpose of the construction is to
meet the requirements of subdivision (a) to allow the use of the
building as a general acute care hospital building after the
extension deadline granted by the office pursuant to subdivision (a)
or (b), and the hospital is making reasonable progress toward meeting
the timeline set forth in subparagraph (D).
   (F) The hospital granted an extension pursuant to this paragraph
shall submit an additional status report to the office, equivalent to
that required by subdivision (c) of Section 130061, no later than
June 30, 2013.
   (4) An extension granted pursuant to paragraph (3) shall be
applicable only to the health care district applicant and its
affiliated hospital while the hospital is operated by the district or
an entity under the control of the district.
   (5) The office may grant the additional extension if the hospital
building subject to the extension meets all of the following
criteria:
   (A) The hospital owner submitted to the office, prior to June 30,
2009, a request for review using current computer modeling utilized
by the office and based upon software developed by the Federal
Emergency Management Agency, referred to as Hazards US, and the
building was deemed SPC-1 after that review.
   (B) The hospital building plans for the building are submitted to
the office and deemed ready for review by the office prior to July 1,
2010. The hospital shall indicate, upon submission of its plans, the
SPC-1 building or buildings that shall be retrofitted or replaced to
meet the requirements of this section as a result of the project.
   (C) The hospital receives a building permit from the office for
the construction described in subparagraph (B) prior to January 1,
2012.
   (D) The hospital submits, prior to January 1, 2012, a construction
timeline for the building demonstrating the hospital's intent and
ability to meet the applicable deadline. The timeline shall include
all of the following:
   (i) The projected construction start date.
   (ii) The projected construction completion date.
   (iii) Identification of the contractor.
   (E) The hospital building is under construction at the time of the
request for the extension, the purpose of the construction is to
meet the requirements of subdivision (a) to allow the use of the
building as a general acute care hospital building after the
extension deadline granted by the office pursuant to subdivision (a)
or (b), and the hospital is making reasonable progress toward meeting
the timeline set forth in subparagraph (D).
   (F) The hospital owner completes construction such that the
hospital meets all criteria to enable the office to issue a
certificate of occupancy by the applicable deadline for the building.

   (6) A hospital denied an extension pursuant to this subdivision
may appeal the denial to the Hospital Building Safety Board.
   (7) The office may revoke an extension granted pursuant to this
subdivision for any hospital building where the work of construction
is abandoned or suspended for a period of at least one year, unless
the hospital demonstrates in a public document that the abandonment
or suspension was caused by factors beyond its control.
  SEC. 140.  Section 130251 of the Health and Safety Code is amended
to read:
   130251.  (a) The California Health and Human Services Agency or
one of the departments under its jurisdiction may apply for federal
funds made available through the federal American Recovery and
Reinvestment Act of 2009 (P.L. 111-5) for health information
technology and exchange.
   (b) In the event that the California Health and Human Services
Agency or one of the departments under its jurisdiction elects not to
submit an application described in subdivision (a), the Governor
shall designate a qualified nonprofit entity to be the
state-designated entity for the purposes of health information
exchange, pursuant to the requirements set forth in ARRA.
   (c) The agency or state-designated entity shall execute tasks
related to accessing federal stimulus funds made available through
ARRA, and facilitate and expand the use and disclosure of health
information electronically among organizations according to
nationally recognized standards and implementation specifications
while protecting, to the greatest extent possible, individual privacy
and the confidentiality of electronic medical records.
   (d) The agency or state-designated entity shall develop a plan to
ensure that health information exchange capabilities are available,
adopted, and utilized statewide so that patients do not experience
disparities in access to the benefits of this technology by age,
race, ethnicity, language, income, insurance status, geography, or
otherwise.
   (e) The agency or state-designated entity shall create a plan for
a self-sustaining funding mechanism that does not include use of
General Fund moneys that shall cover all reasonable costs of the
administration of health information exchange when federal ARRA funds
expire or are exhausted.
   (f) The state-designated entity shall continually meet any
conditions for being so designated as determined by the Secretary of
California Health and Human Services. Failure to comply with this
subdivision may result in the entity losing its designation.
   (g) As a condition of receiving the state designation, the
state-designated entity shall comply with all of the following
requirements:
   (1) It shall be subject to oversight by the California Health and
Human Services Agency.
   (2) (A) It shall be governed by a board with a diverse composition
from multiple types of organizations from multiple regions
throughout the state. The governing board shall include, at a
minimum, all of the following:
   (i) The Secretary of California Health and Human Services or his
or her designee.
   (ii) The Chairperson of the Senate Committee on Health or his or
her designee.
   (iii) The Chairperson of the Assembly Committee on Health or his
or her designee.
   (iv) At least two consumer representatives, one of whom shall have
expertise in privacy and security of health information.
   (B) The majority of the board shall be comprised of
nongovernmental employees.
   (3) If the board convenes workgroups or subcommittees, the
workgroups or subcommittees shall be comprised of representatives
from multiple types of organizations from multiple regions throughout
the state, and meetings of any workgroup or subcommittee shall be
held in an open, public, and transparent way.
   (4) It shall have nondiscrimination and conflict-of-interest
policies that demonstrate a commitment to open, fair, and
nondiscriminatory participation by stakeholders.
   (h) The state-designated entity shall report to the California
Health and Human Services Agency and the Legislature on its progress
and activities at least annually.
  SEC. 141.  Section 38.5 of the Insurance Code is amended to read:
   38.5.  Any written notice required to be given or mailed to any
person by an insurer relating to any insurance on risks or on
operations in this state not excepted by Section 1851 from the
coverage of Chapter 9 (commencing with Section 1850.4) of Part 2 of
Division 1 of this code may, if not excluded by subdivision (b) or
(c) of Section 1633.3 of the Civil Code, be provided by electronic
transmission pursuant to Title 2.5 (commencing with Section 1633.1)
of Part 2 of Division 3 of the Civil Code, if each party has agreed
to conduct the transaction by electronic means pursuant to Section
1633.5 of the Civil Code. The affidavit of the person who initiated
the electronic transmission, stating the facts of that transmission
into an information processing system outside of the control of the
sender                                          or of any person that
sent the electronic record on behalf of the sender, is prima facie
evidence that the notice was transmitted and shall be sufficient
proof of notice. Any notice provided by electronic transmission shall
be treated as if mailed or given for the purposes of any provision
of this code, except as provided by subdivision (g) of Section
1633.15 of the Civil Code. The insurance company shall maintain a
system for confirming that any notice or document that is to be
provided by electronic means has been sent in a manner consistent
with Section 1633.15 of the Civil Code. A valid electronic signature
shall be sufficient for any provision of law requiring a written
signature. The insurance company shall retain a copy of the
confirmation and electronic signature, when either is required, with
the policy information so that they are retrievable upon request by
the Department of Insurance while the policy is in force and for five
years thereafter.
  SEC. 142.  Section 1063.1 of the Insurance Code is amended to read:

   1063.1.  As used in this article:
   (a) "Member insurer" means an insurer required to be a member of
the association in accordance with subdivision (a) of Section 1063,
except and to the extent that the insurer is participating in an
insolvency program adopted by the United States government.
   (b) "Insolvent insurer" means an insurer that was a member insurer
of the association, consistent with paragraph (11) of subdivision
(c), either at the time the policy was issued or when the insured
event occurred, and against which an order of liquidation or
receivership with a finding of insolvency has been entered by a court
of competent jurisdiction, or, in the case of the State Compensation
Insurance Fund, if a finding of insolvency is made by a duly enacted
legislative measure.
   (c) (1) "Covered claims" means the obligations of an insolvent
insurer, including the obligation for unearned premiums, that satisfy
all of the following requirements:
   (A) Imposed by law and within the coverage of an insurance policy
of the insolvent insurer.
   (B) Which were unpaid by the insolvent insurer.
   (C) Which are presented as a claim to the liquidator in this state
or to the association on or before the last date fixed for the
filing of claims in the domiciliary liquidating proceedings.
   (D) Which were incurred prior to the date coverage under the
policy terminated and prior to, on, or within 30 days after the date
the liquidator was appointed.
   (E) For which the assets of the insolvent insurer are insufficient
to discharge in full.
   (F) In the case of a policy of workers' compensation insurance, to
provide workers' compensation benefits under the workers'
compensation law of this state.
   (G) In the case of other classes of insurance if the claimant or
insured is a resident of this state at the time of the insured
occurrence, or the property from which the claim arises is
permanently located in this state.
   (2) "Covered claims" also includes the obligations assumed by an
assuming insurer from a ceding insurer where the assuming insurer
subsequently becomes an insolvent insurer if, at the time of the
insolvency of the assuming insurer, the ceding insurer is no longer
admitted to transact business in this state. Both the assuming
insurer and the ceding insurer shall have been member insurers at the
time the assumption was made. "Covered claims" under this paragraph
shall be required to satisfy the requirements of subparagraphs (A) to
(G), inclusive, of paragraph (1), except for the requirement that
the claims be against policies of the insolvent insurer. The
association shall have a right to recover any deposit, bond, or other
assets that may have been required to be posted by the ceding
company to the extent of covered claim payments and shall be
subrogated to any rights the policyholders may have against the
ceding insurer.
   (3) "Covered claims" does not include obligations arising from the
following:
   (A) Life, annuity, health, or disability insurance.
   (B) Mortgage guaranty, financial guaranty, or other forms of
insurance offering protection against investment risks.
   (C) Fidelity or surety insurance including fidelity or surety
bonds, or any other bonding obligations.
   (D) Credit insurance.
   (E) Title insurance.
   (F) Ocean marine insurance or ocean marine coverage under any
insurance policy including claims arising from the following: the
Jones Act (46 U.S.C. Sec. 688), the Longshore and Harbor Workers'
Compensation Act (33 U.S.C. Sec. 901 et seq.), or any other similar
federal statutory enactment, or any endorsement or policy affording
protection and indemnity coverage.
   (G) Any claims servicing agreement or insurance policy providing
retroactive insurance of a known loss or losses, except a special
excess workers' compensation policy issued pursuant to subdivision
(c) of Section 3702.8 of the Labor Code that covers all or any part
of workers' compensation liabilities of an employer that is issued,
or was previously issued, a certificate of consent to self-insure
pursuant to subdivision (b) of Section 3700 of the Labor Code.
   (4) "Covered claims" does not include any obligations of the
insolvent insurer arising out of any reinsurance contracts, nor any
obligations incurred after the expiration date of the insurance
policy or after the insurance policy has been replaced by the insured
or canceled at the insured's request, or after the insurance policy
has been canceled by the liquidator, nor any obligations to any state
or to the federal government.
   (5) "Covered claims" does not include any obligations to insurers,
insurance pools, or underwriting associations, nor their claims for
contribution, indemnity, or subrogation, equitable or otherwise,
except as otherwise provided in this chapter.
   An insurer, insurance pool, or underwriting association may not
maintain, in its own name or in the name of its insured, any claim or
legal action against the insured of the insolvent insurer for
contribution, indemnity or by way of subrogation, except insofar as,
and to the extent only, that the claim exceeds the policy limits of
the insolvent insurer's policy. In those claims or legal actions, the
insured of the insolvent insurer is entitled to a credit or setoff
in the amount of the policy limits of the insolvent insurer's policy,
or in the amount of the limits remaining, where those limits have
been diminished by the payment of other claims.
   (6) "Covered claims," except in cases involving a claim for
workers' compensation benefits or for unearned premiums, does not
include any claim in an amount of one hundred dollars ($100) or less,
nor that portion of any claim that is in excess of any applicable
limits provided in the insurance policy issued by the insolvent
insurer.
   (7) "Covered claims" does not include that portion of any claim,
other than a claim for workers' compensation benefits, that is in
excess of five hundred thousand dollars ($500,000).
   (8) "Covered claims" does not include any amount awarded as
punitive or exemplary damages, nor any amount awarded by the Workers'
Compensation Appeals Board pursuant to Section 5814 or 5814.5 of the
Labor Code because payment of compensation was unreasonably delayed
or refused by the insolvent insurer.
   (9) "Covered claims" does not include (A) any claim to the extent
it is covered by any other insurance of a class covered by this
article available to the claimant or insured or (B) any claim by any
person other than the original claimant under the insurance policy in
his or her own name, his or her assignee as the person entitled
thereto under a premium finance agreement as defined in Section 673
and entered into prior to insolvency, his or her executor,
administrator, guardian, or other personal representative or trustee
in bankruptcy, and does not include any claim asserted by an assignee
or one claiming by right of subrogation, except as otherwise
provided in this chapter.
   (10) "Covered claims" does not include any obligations arising out
of the issuance of an insurance policy written by the separate
division of the State Compensation Insurance Fund pursuant to
Sections 11802 and 11803.
   (11) "Covered claims" does not include any obligations of the
insolvent insurer arising from any policy or contract of insurance
issued or renewed prior to the insolvent insurer's admission to
transact insurance in the State of California.
   (12) "Covered claims" does not include surplus deposits of
subscribers as defined in Section 1374.1.
   (13) "Covered claims" shall also include obligations arising under
an insurance policy written to indemnify a permissibly self-insured
employer pursuant to subdivision (b) or (c) of Section 3700 of the
Labor Code for its liability to pay workers' compensation benefits in
excess of a specific or aggregate retention, provided, however, that
for purposes of this article, those claims shall not be considered
workers' compensation claims and therefore are subject to the per
claim limit in paragraph (7) and any payments and expenses related
thereto shall be allocated to category (c) for claims other than
workers' compensation, homeowners, and automobile, as provided in
Section 1063.5.
   These provisions shall apply to obligations arising under any
policy as described herein issued to a permissibly self-insured
employer or group of self-insured employers pursuant to Section 3700
of the Labor Code and notwithstanding any other provision of this
code, those obligations shall be governed by this provision in the
event that the Self-Insurers' Security Fund is ordered to assume the
liabilities of a permissibly self-insured employer or group of
self-insured employers pursuant to Section 3701.5 of the Labor Code.
The provisions of this paragraph apply only to insurance policies
written to indemnify a permissibly self-insured employer or group of
self-insured employers under subdivision (b) or (c) of Section 3700
of the Labor Code, for its liability to pay workers' compensation
benefits in excess of a specific or aggregate retention, and this
paragraph does not apply to special excess workers' compensation
insurance policies unless issued pursuant to authority granted in
subdivision (c) of Section 3702.8 of the Labor Code, and as provided
for in subparagraph (G) of paragraph (3). In addition, this paragraph
does not apply to any claims servicing agreement or insurance policy
providing retroactive insurance of a known loss or losses as are
excluded in subparagraph (G) of paragraph (3).
   Each permissibly self-insured employer or group of self-insured
employers, or the Self-Insurers' Security Fund, shall, to the extent
required by the Labor Code, be responsible for paying, adjusting, and
defending each claim arising under policies of insurance covered
under this section, unless the benefits paid on a claim exceed the
specific or aggregate retention, in which case:
   (A) If the benefits paid on the claim exceed the specific or
aggregate retention, and the policy requires the insurer to defend
and adjust the claim, the California Insurance Guarantee Association
(CIGA) shall be solely responsible for adjusting and defending the
claim, and shall make all payments due under the claim, subject to
the limitations and exclusions of this article with regard to covered
claims. As to each claim subject to this paragraph, notwithstanding
any other provisions of this code or the Labor Code, and regardless
of whether the amount paid by CIGA is adequate to discharge a claim
obligation, neither the self-insured employer, group of self-insured
employers, nor the Self-Insurers' Security Fund, shall have any
obligation to pay benefits over and above the specific or aggregate
retention, except as provided in this subdivision.
   (B) If the benefits paid on the claim exceed the specific or
aggregate retention, and the policy does not require the insurer to
defend and adjust the claim, the permissibly self-insured employer or
group of self-insured employers, or the Self-Insurers' Security
Fund, shall not have any further payment obligations with respect to
the claim, but shall continue defending and adjusting the claim, and
shall have the right, but not the obligation, in any proceeding to
assert all applicable statutory limitations and exclusions as
contained in this article with regard to the covered claim. CIGA
shall have the right, but not the obligation, to intervene in any
proceeding where the self-insured employer, group of self-insured
employers, or the Self-Insurers' Security Fund is defending any such
claim and shall be permitted to raise the appropriate statutory
limitations and exclusions as contained in this article with respect
to covered claims. Regardless of whether the self-insured employer or
group of self-insured employers, or the Self-Insurers' Security
Fund, asserts the applicable statutory limitations and exclusions, or
whether CIGA intervenes in any such proceeding, CIGA shall be solely
responsible for paying all benefits due on the claim, subject to the
exclusions and limitations of this article with respect to covered
claims. As to each claim subject to this paragraph, notwithstanding
any other provision of the Insurance Code or the Labor Code and
regardless of whether the amount paid by CIGA is adequate to
discharge a claim obligation, neither the self-insured employer,
group of self-insured employers, nor the Self-Insurers' Security
Fund, shall have any obligation to pay benefits over and above the
specific or aggregate retention, except as provided in this
subdivision.
   (C) In the event that the benefits paid on the covered claim
exceed the per claim limit in paragraph (7), the responsibility for
paying, adjusting, and defending the claim shall be returned to the
permissibly self-insured employer or group of employers, or the
Self-Insurers' Security Fund.
   These provisions shall apply to all pending and future
insolvencies. For purposes of this paragraph, a pending insolvency is
one involving a company that is currently receiving benefits from
the guarantee association.
   (d) "Admitted to transact insurance in this state" means an
insurer possessing a valid certificate of authority issued by the
department.
   (e) "Affiliate" means a person who directly or indirectly, through
one or more intermediaries, controls, is controlled by, or is under
common control with an insolvent insurer on December 31 of the year
next preceding the date the insurer becomes an insolvent insurer.
   (f) "Control" means the possession, direct or indirect, of the
power to direct or cause the direction of the management and policies
of a person, whether through the ownership of voting securities, by
contract other than a commercial contract for goods or nonmanagement
services, or otherwise, unless the power is the result of an official
position with or corporate office held by the person. Control is
presumed to exist if any person, directly or indirectly, owns,
controls, holds with the power to vote, or holds proxies
representing, 10 percent or more of the voting securities of any
other person. This presumption may be rebutted by showing that
control does not in fact exist.
   (g) "Claimant" means any insured making a first party claim or any
person instituting a liability claim, provided that no person who is
an affiliate of the insolvent insurer may be a claimant.
   (h) "Ocean marine insurance" includes marine insurance as defined
in Section 103, except for inland marine insurance, as well as any
other form of insurance, regardless of the name, label, or marketing
designation of the insurance policy, that insures against maritime
perils or risks and other related perils or risks, which are usually
insured against by traditional marine insurance such as hull and
machinery, marine builders' risks, and marine protection and
indemnity. Those perils and risks insured against include, without
limitation, loss, damage, or expense or legal liability of the
insured arising out of or incident to ownership, operation,
chartering, maintenance, use, repair, or construction of any vessel,
craft, or instrumentality in use in ocean or inland waterways,
including liability of the insured for personal injury, illness, or
death for loss or damage to the property of the insured or another
person.
   (i) "Unearned premium" means that portion of a premium as
calculated by the liquidator that had not been earned because of the
cancellation of the insolvent insurer's policy and is that premium
remaining for the unexpired term of the insolvent insurer's policy.
"Unearned premium" does not include any amount sought as return of a
premium under any policy providing retroactive insurance of a known
loss or return of a premium under any retrospectively rated policy or
a policy subject to a contingent surcharge or any policy in which
the final determination of the premium cost is computed after
expiration of the policy and is calculated on the basis of actual
loss experience during the policy period.
  SEC. 143.  Section 1063.2 of the Insurance Code is amended to read:

   1063.2.  (a) The association shall pay and discharge covered
claims and in connection therewith pay for or furnish loss adjustment
services and defenses of claimants when required by policy
provisions. It may do so either directly by itself or through a
servicing facility or through a contract for reinsurance and
assumption of liabilities by one or more member insurers or through a
contract with the liquidator, upon terms satisfactory to the
association and to the liquidator, under which payments on covered
claims would be made by the liquidator using funds provided by the
association.
   (b) The association shall be a party in interest in all
proceedings involving a covered claim, and shall have the same rights
as the insolvent insurer would have had if not in liquidation,
including, but not limited to, the right to: (1) appear, defend, and
appeal a claim in a court of competent jurisdiction, (2) receive
notice of, investigate, adjust, compromise, settle, and pay a covered
claim, and (3) investigate, handle, and deny a noncovered claim. The
association shall have no cause of action against the insureds of
the insolvent insurer for any sums it has paid out, except as
provided by this article.
   (c) (1) If damages against uninsured motorists are recoverable by
the claimant from his or her own insurer, the applicable limits of
the uninsured motorist coverage shall be a credit against a covered
claim payable under this article. Any person having a claim that may
be recovered under more than one insurance guaranty association or
its equivalent shall seek recovery first from the association of the
place of residence of the insured, except that if it is a first-party
claim for damage to property with a permanent location, he or she
shall seek recovery first from the association of the permanent
location of the property, and if it is a workers' compensation claim,
he or she shall seek recovery first from the association of the
residence of the claimant. Any recovery under this article shall be
reduced by the amount of recovery from any other insurance guaranty
association or its equivalent. A member insurer may recover in
subrogation from the association only one-half of any amount paid by
that insurer under uninsured motorist coverage for bodily injury or
wrongful death (and nothing for a payment for anything else), in
those cases where the injured person insured by such an insurer has
proceeded under his or her uninsured motorist coverage on the ground
that the tortfeasor is uninsured as a result of the insolvency of his
or her liability insurer (an insolvent insurer as defined in this
article), provided that the member insurer shall waive all rights of
subrogation against the tortfeasor. Any amount paid a claimant in
excess of the amount authorized by this section may be recovered by
action, or other proceeding, brought by the association.
   (2) Any claimant having collision coverage on a loss that is
covered by the insolvent company's liability policy shall first
proceed against his or her collision carrier. Neither that claimant
nor the collision carrier, if it is a member of the association,
shall have the right to sue or continue a suit against the insured of
the insolvent insurance company for that collision damage.
   (d) The association shall have the right to recover from any
person who is an affiliate of the insolvent insurer and whose
liability obligations to other persons are satisfied in whole or in
part by payments made under this article the amount of any covered
claim and allocated claims expense paid on behalf of that person
pursuant to this article.
   (e) Any person having a claim or legal right of recovery under any
governmental insurance or guaranty program which is also a covered
claim, shall be required to first exhaust his or her right under the
program. Any amount payable on a covered claim shall be reduced by
the amount of any recovery under the program.
   (f) "Covered claims" for unearned premium by lenders under
insurance premium finance agreements as defined in Section 673 shall
be computed as of the earliest cancellation date of the policy
pursuant to Section 673.
   (g) "Covered claims" shall not include any judgments against or
obligations or liabilities of the insolvent insurer or the
commissioner, as liquidator, or otherwise resulting from alleged or
proven torts, nor shall any default judgment or stipulated judgment
against the insolvent insurer, or against the insured of the
insolvent insurer, be binding against the association.
   (h) "Covered claims" shall not include any loss adjustment
expenses, including adjustment fees and expenses, attorney's fees and
expenses, court costs, interest, and bond premiums, incurred prior
to the appointment of a liquidator.
  SEC. 144.  Section 10136 of the Insurance Code is amended to read:
   10136.  (a) No direct or indirect transfer of structured
settlement payment rights by a payee to which this article applies
shall be effective, and no structured settlement obligor or annuity
issuer shall be required to make any payment directly or indirectly
to a transferee, unless all of the provisions of this section are
satisfied.
   (b) Ten or more days before the payee executes a transfer
agreement, the transferee shall provide the payee with a separate
written disclosure statement, accurately completed with the
information that applies to the transfer agreement, in substantially
the following form, in at least 12-point type unless otherwise
indicated (bracketed instructions shall not appear in the form):


   "Disclosure Notice Required By Law [14-point boldface type]
   You are selling (technically called 'transferring') your right to
receive your payments under a structured settlement. You should get
this disclosure notice at least 10 days before you sign any contract.

      IMPORTANT TERMS: [14-point boldface type ]

   You have agreed to sell to the transferee future payments totaling
____ dollars ($____) in exchange for a purchase price of ____
dollars ($____).
   Those future payments have a discounted present value equal to
____ dollars ($____), calculated by applying the discount rate of
____ percent utilized by the Internal Revenue Service to value
annuities in probate proceedings.
   The purchase price to be paid to you was calculated using a
discount rate of ____ percent.
   The purchase price payable to you is less than the present value
of the future payments stated above because the discount rate of your
transaction is greater than the rate utilized by the Internal
Revenue Service.
   For comparison purposes:
   If you did not sell your right to receive structured settlement
payments, but instead borrowed the net amount of $____ and paid that
loan back in installments with each of the payments you are now
selling, the equivalent interest rate you would be paying for that
loan would be ____% per year.
   [The text and information set forth above under 'IMPORTANT TERMS'
shall be in 14-point type and circumscribed by a box with a bold
border]
   To figure the net amount we are paying, we have charged you for
the following expenses:
      [itemize in a list by type and amount]

for a total of $____ in expenses.
   You should get independent professional advice about whether
selling your structured settlement payments is a good idea for you
and for your dependents.
   You are advised to seek independent legal or financial advice
regarding the transaction and, under the law, the cost of that
advice, up to one thousand five hundred dollars ($1,500), will be
paid by the transferee, the person or entity to whom you have agreed
to transfer and assign the payments in question. The transferee or
purchaser's accountant, counsel, or actuary may not advise you in
this transaction.
   You also should get independent professional advice from an
accountant or lawyer experienced in tax matters about any income tax
consequences from selling your structured settlement payments. We
cannot give you the name of anyone to advise you.
   Court approval is needed [14-point boldface type]. A court must
approve any agreement you sign to sell your rights under a structured
settlement. You will not receive any money until the court approves
the sale. Court approval could take more than 30 days following the
day you sign an agreement selling your rights under a structured
settlement.
   A sale of future structured settlement payments will mean that you
will no longer receive the future payments that are sold. You are
advised to enter into this transaction only after you have carefully
considered the consequences of the transaction.
   You may cancel the contract before court approval [14-point
boldface type]. You may cancel the agreement selling (or
transferring) your rights under a structured settlement without any
cost or obligation. You may cancel at any time before the court
approves the contract. You will get notice of the date of the court
hearing.
   If you want to cancel, you do not need any special form. But, you
must cancel in writing. Send your cancellation to: [insert transferee'
s name and address].
   If you believe that you have been treated unfairly or have been
misled, you should contact your local district attorney or the state
Attorney General."


   (c) The transfer agreement shall be written in at least 12-point
type and shall be complete and without blank spaces to be completed
after the payee's signature. The transfer agreement shall set forth
clear and conspicuously, and in no less than 12-point type, all of
the following:
   (1) A statement that the agreement is not effective until the date
on which a court enters a final order approving the transfer
agreement and that payment to
   the payee pursuant to the transfer agreement will be delayed up to
30 days or more after the date the payee signed the transfer
agreement in order for the court to review and approve the transfer
agreement.
   (2) The amounts and due dates of the structured settlement
payments to be transferred.
   (3) The aggregate amount of the structured settlement payments to
be transferred. This amount shall be disclosed in the form prescribed
in subdivision (b).
   (4) The aggregate amount of all expenses, if any, to be deducted
from the purchase price to be paid to the payee in exchange for the
payments to be transferred, and an itemization of all expenses by
type and amount.
   (5) The amount payable to the payee, net of all expenses, in
exchange for the payments to be transferred. This amount shall be
disclosed in the form prescribed in subdivision (b).
   (6) The discounted present value of all structured settlement
payments to be transferred and a statement that "This is the value of
your structured settlement in current dollars." This amount shall be
disclosed in the form prescribed in subdivision (b).
   (7) The federal rate, as described in subdivision (c) of Section
10134, used in determining the discounted present value.
   (8) The effective equivalent interest rate, which shall be
disclosed in the following statement:


   "YOU WILL BE PAYING THE EQUIVALENT OF AN INTEREST RATE OF ____%
PER YEAR.
   Based on the net amount that you will receive from us and the
amounts and timing of the structured settlement payments that you are
transferring to us, if the transferred structured settlement
payments were installment payments on a loan, with each payment
applied first to accrued unpaid interest and then to principal, it
would be as if you were paying interest to us of ____% per year,
assuming funding on the effective date of transfer."


   This percentage amount shall be disclosed in the form prescribed
in subdivision (b) in the space for "the equivalent interest rate you
would be paying for this loan would be ____% per year."
   (9) The quotient (expressed as a percentage) obtained by dividing
the net payment amount by the discounted present value of the
payments.
   (10) A statement that the payee should obtain independent
professional advice regarding any federal and state income tax
consequences arising from the proposed transfer, and that the
transferee may not refer the payee to any specific adviser for that
purpose.
   (11) A statement that the court approving the transfer agreement
retains continuing jurisdiction to interpret and monitor
implementation of the agreement as justice may require.
   (12) The following statement: "If you believe you were treated
unfairly or were misled as to the nature of the obligations you
assumed upon entering into this agreement, you should report those
circumstances to your local district attorney or the office of the
Attorney General."
   (13) The following statement printed in 14-point type,
circumscribed by a box with a bold border, and set forth immediately
above or adjacent to the space reserved for the payee's signature:
"You have the right to cancel this agreement without any cost or
obligation until the date the court approves this agreement. You will
receive notice of the court hearing date when approval may occur.
You must cancel in writing and send your cancellation to [insert
transferee's name and address]."
   (d) The contract for transferring the structured settlement
payment rights may not violate Section 10138.
   (e) At any time before the date on which a court enters a final
order approving the transfer agreement pursuant to Section 10139.5,
the payee may cancel the transfer agreement, without cost or further
obligation, by providing written notice of cancellation to the
transferee.
  SEC. 145.  Section 10192.4 of the Insurance Code is amended to
read:
   10192.4.  The following definitions apply for the purposes of this
article:
   (a) "Applicant" means:
   (1) The person who seeks to contract for insurance benefits, in
the case of an individual Medicare supplement policy.
   (2) The proposed certificate holder, in the case of a group
Medicare supplement policy.
   (b) "Bankruptcy" means that situation in which a Medicare
Advantage organization that is not an issuer has filed, or has had
filed against it, a petition for declaration of bankruptcy and has
ceased doing business in the state.
   (c) "Certificate" means a certificate issued for delivery in this
state under a group Medicare supplement policy.
   (d) "Certificate form" means the form on which the certificate is
issued for delivery by the issuer.
   (e) "Continuous period of creditable coverage" means the period
during which an individual was covered by creditable coverage, if
during the period of the coverage the individual had no breaks in
coverage greater than 63 days.
   (f) (1) "Creditable coverage" means, with respect to an
individual, coverage of the individual provided under any of the
following:
   (A) Any individual or group contract, policy, certificate, or
program that is written or administered by a health care service
plan, health insurer, fraternal benefits society, self-insured
employer plan, or any other entity, in this state or elsewhere, and
that arranges or provides medical, hospital, and surgical coverage
not designed to supplement other private or governmental plans. The
term includes continuation or conversion coverage.
   (B) Part A or B of Title XVIII of the federal Social Security Act
(42 U.S.C. Sec. 1395c et seq.) (Medicare).
   (C) Title XIX of the federal Social Security Act (42 U.S.C. Sec.
1396 et seq.) (Medicaid (known as Medi-Cal in California)), other
than coverage consisting solely of benefits under Section 1928 of
that act.
   (D) Chapter 55 of Title 10 of the United States Code (CHAMPUS).
   (E) A medical care program of the Indian Health Service or of a
tribal organization.
   (F) A state health benefits risk pool.
   (G) A health plan offered under Chapter 89 of Title 5 of the
United States Code (Federal Employees Health Benefits Program).
   (H) A public health plan as defined in federal regulations
authorized by Section 2701(c)(1)(I) of the federal Public Health
Service Act, as amended by Public Law 104-191, the federal Health
Insurance Portability and Accountability Act of 1996.
   (I) A health benefit plan under Section 5(e) of the federal Peace
Corps Act (Section 2504(e) of Title 22 of the United States Code).
   (J) Any other publicly sponsored program, provided in this state
or elsewhere, of medical, hospital, and surgical care.
   (K) Any other creditable coverage as defined by subsection (c) of
Section 2701 of Title XXVII of the federal Public Health Service Act
(42 U.S.C. Sec. 300gg(c)).
   (2) "Creditable coverage" shall not include one or more, or any
combination of, the following:
   (A) Coverage only for accident or disability income insurance, or
any combination thereof.
   (B) Coverage issued as a supplement to liability insurance.
   (C) Liability insurance, including general liability insurance and
automobile liability insurance.
   (D) Workers' compensation or similar insurance.
   (E) Automobile medical payment insurance.
   (F) Credit-only insurance.
   (G) Coverage for onsite medical clinics.
   (H) Other similar insurance coverage, specified in federal
regulations, under which benefits for medical care are secondary or
incidental to other insurance benefits.
   (3) "Creditable coverage" shall not include the following benefits
if they are provided under a separate policy, certificate, or
contract of insurance or are otherwise not an integral part of the
plan:
   (A) Limited scope dental or vision benefits.
   (B) Benefits for long-term care, nursing home care, home health
care, community-based care, or any combination thereof.
   (C) Other similar, limited benefits as are specified in federal
regulations.
   (4) "Creditable coverage" shall not include the following benefits
if offered as independent, noncoordinated benefits:
   (A) Coverage only for a specified disease or illness.
   (B) Hospital indemnity or other fixed indemnity insurance.
   (5) "Creditable coverage" shall not include the following if
offered as a separate policy, certificate, or contract of insurance:
   (A) Medicare supplemental health insurance as defined under
Section 1882(g)(1) of the federal Social Security Act.
   (B) Coverage supplemental to the coverage provided under Chapter
55 of Title 10 of the United States Code.
   (C) Similar supplemental coverage provided to coverage under a
group health plan.
   (g) "Employee welfare benefit plan" means a plan, fund, or program
of employee benefits as defined in Section 1002 of Title 29 of the
United States Code (Employee Retirement Income Security Act).
   (h) "Insolvency" means when an issuer, licensed to transact the
business of insurance in this state, has had a final order of
liquidation entered against it with a finding of insolvency by a
court of competent jurisdiction in the issuer's state of domicile.
   (i) "Issuer" includes insurance companies, fraternal benefit
societies, and any other entity delivering, or issuing for delivery,
Medicare supplement policies or certificates in this state, except
entities subject to Article 3.5 (commencing with Section 1358.1) of
Chapter 2.2 of Division 2 of the Health and Safety Code.
   (j) "Medi-Cal" means California's version of Medicaid under Title
XIX of the federal Social Security Act.
   (k) "Medicare" means the Health Insurance for the Aged Act, Title
XVIII of the Social Security Amendments of 1965, as amended.
   (l) "Medicare Advantage plan" means a plan of coverage for health
benefits under Medicare Part C and includes:
   (1) Coordinated care plans that provide health care services,
including, but not limited to, health care service plans (with or
without a point-of-service option), plans offered by
provider-sponsored organizations, and preferred provider
organizations plans.
   (2) Medical savings account plans coupled with a contribution into
a Medicare Advantage medical savings account.
   (3) Medicare Advantage private fee-for-service plans.
   (m) "Medicare supplement policy" means a group or individual
policy of health insurance, other than a policy issued pursuant to a
contract under Section 1876 of the federal Social Security Act (42
U.S.C. Sec. 1395mm) or an issued policy under a demonstration project
specified in Section 1395ss(g)(1) of Title 42 of the United States
Code, that is advertised, marketed, or designed primarily as a
supplement to reimbursements under Medicare for the hospital,
medical, or surgical expenses of persons eligible for Medicare.
"Medicare supplement policy" does not include a Medicare Advantage
plan established under Medicare Part C, an outpatient prescription
drug plan established under Medicare Part D, or a health care
prepayment plan that provides benefits pursuant to an agreement under
subparagraph (A) of paragraph (1) of subsection (a) of Section 1833
of the federal Social Security Act.
   (n) "Policy form" means the form on which the policy is issued for
delivery by the issuer.
   (o) "1990 standardized Medicare supplement benefit plan," "1990
standardized benefit plan," or "1990 plan" means a group or
individual policy of Medicare supplement insurance issued on or after
July 21, 1992, and with an effective date prior to June 1, 2010, and
includes Medicare supplement insurance policies and certificates
renewed on or after that date which are not replaced by the issuer at
the request of the insured.
   (p) "2010 standardized Medicare supplement benefit plan," "2010
standardized benefit plan," or "2010 plan" means a group or
individual policy of Medicare supplement insurance issued with an
effective date on or after June 1, 2010.
   (q) "Secretary" means the Secretary of the United States
Department of Health and Human Services.
  SEC. 146.  Section 10192.81 of the Insurance Code is amended to
read:
   10192.81.  The following standards are applicable to all Medicare
supplement policies or certificates delivered or issued for delivery
in this state with an effective date on or after June 1, 2010. No
policy or certificate may be advertised, solicited, delivered, or
issued for delivery in this state as a Medicare supplement policy or
certificate unless it complies with these benefit standards. No
issuer may offer any 1990 standardized Medicare supplement benefit
plan for sale with an effective date on or after June 1, 2010.
Benefit standards applicable to Medicare supplement policies and
certificates issued with an effective date prior to June 1, 2010,
remain subject to the requirements of Section 10192.8.
   (a) The following general standards apply to Medicare supplement
policies and certificates and are in addition to all other
requirements of this article:
   (1) A Medicare supplement policy or certificate shall not exclude
or limit benefits for losses incurred more than six months from the
effective date of coverage because it involved a preexisting
condition. The policy or certificate shall not define a preexisting
condition more restrictively than a condition for which medical
advice was given or treatment was recommended by or received from a
physician within six months before the effective date of coverage.
   (2) A Medicare supplement policy or certificate shall not
indemnify against losses resulting from sickness on a different basis
than losses resulting from accidents.
   (3) A Medicare supplement policy or certificate shall provide that
benefits designed to cover cost-sharing amounts under Medicare will
be changed automatically to coincide with any changes in the
applicable Medicare deductible, copayment, or coinsurance amounts.
Premiums may be modified to correspond with those changes.
   (4) A Medicare supplement policy or certificate shall not provide
for termination of coverage of a spouse solely because of the
occurrence of an event specified for termination of coverage of the
insured, other than the nonpayment of premium.
   (5) Each Medicare supplement policy shall be guaranteed renewable.

   (A) The issuer shall not cancel or nonrenew the policy solely on
the ground of health status of the individual.
   (B) The issuer shall not cancel or nonrenew the policy for any
reason other than nonpayment of premium or material misrepresentation
which is shown by the issuer to be material to the acceptance for
coverage. The contestability period for Medicare supplement insurance
shall be two years, pursuant to Section 10350.2.
   (C) If the Medicare supplement policy is terminated by the master
policyholder and is not replaced as provided under subparagraph (E),
the issuer shall offer certificate holders an individual Medicare
supplement policy which, at the option of the certificate holder,
does one of the following:
   (i) Provides for continuation of the benefits contained in the
group policy.
   (ii) Provides for benefits that otherwise meet the requirements of
one of the standardized policies defined in this article.
   (D) If an individual is a certificate holder in a group Medicare
supplement policy and the individual terminates membership in the
group, the issuer shall do one of the following:
   (i) Offer the certificate holder the conversion opportunity
described in subparagraph (C).
   (ii) At the option of the group policyholder, offer the
certificate holder continuation of coverage under the group policy.
   (E) (i) If a group Medicare supplement policy is replaced by
another group Medicare supplement policy purchased by the same
policyholder, the issuer of the replacement policy shall offer
coverage to all persons covered under the old group policy on its
date of termination. Coverage under the new policy shall not result
in any exclusion for preexisting conditions that would have been
covered under the group policy being replaced.
   (ii) If a Medicare supplement policy or certificate replaces
another Medicare supplement policy or certificate that has been in
force for six months or more, the replacing issuer shall not impose
an exclusion or limitation based on a preexisting condition. If the
original coverage has been in force for less than six months, the
replacing issuer shall waive any time period applicable to
preexisting conditions, waiting periods, elimination periods, or
probationary periods in the new policy or certificate to the extent
the time was spent under the original coverage.
   (6) Termination of a Medicare supplement policy or certificate
shall be without prejudice to any continuous loss that commenced
while the policy was in force, but the extension of benefits beyond
the period during which the policy was in force may be predicated
upon the continuous total disability of the insured, limited to the
duration of the policy benefit period, if any, or payment of the
maximum benefits. Receipt of Medicare Part D benefits shall not be
considered in determining a continuous loss.
   (7) (A) (i) A Medicare supplement policy or certificate shall
provide that benefits and premiums under the policy or certificate
shall be suspended at the request of the policyholder or certificate
holder for the period, not to exceed 24 months, in which the
policyholder or certificate holder has applied for and is determined
to be entitled to medical assistance under Medi-Cal, but only if the
policyholder or certificate holder notifies the issuer of the policy
or certificate within 90 days after the date the individual becomes
entitled to assistance. Upon receipt of timely notice, the insurer
shall return directly to the insured that portion of the premium
attributable to the period of Medi-Cal eligibility, subject to
adjustment for paid claims.
   (ii) If suspension occurs and if the policyholder or certificate
holder loses entitlement to medical assistance under Medi-Cal, the
policy or certificate shall be automatically reinstituted (effective
as of the date of termination of entitlement) as of the termination
of entitlement if the policyholder or certificate holder provides
notice of loss of entitlement within 90 days after the date of loss
and pays the premium attributable to the period, effective as of the
date of termination of entitlement or equivalent coverage shall be
provided if the prior form is no longer available.
   (iii) Each Medicare supplement policy shall provide that benefits
and premiums under the policy shall be suspended (for any period that
may be provided by federal regulation) at the request of the
policyholder if the policyholder is entitled to benefits under
Section 226(b) of the federal Social Security Act and is covered
under a group health plan (as defined in Section 1862(b)(1)(A)(v) of
the federal Social Security Act). If suspension occurs and if the
policyholder or certificate holder loses coverage under the group
health plan, the policy shall be automatically reinstituted
(effective as of the date of loss of coverage) if the policyholder
provides notice of loss of coverage within 90 days after the date of
the loss and pays the applicable premium.
   (B) Reinstitution of coverages shall comply with all of the
following requirements:
   (i) Not provide for any waiting period with respect to treatment
of preexisting conditions.
   (ii) Provide for resumption of coverage that is substantially
equivalent to coverage in effect before the date of suspension.
   (iii) Provide for classification of premiums on terms at least as
favorable to the policyholder or certificate holder as the premium
classification terms that would have applied to the policyholder or
certificate holder had the coverage not been suspended.
   (8) A Medicare supplement policy shall not limit coverage
exclusively to a single disease or affliction.
   (9) A Medicare supplement policy shall provide an examination
period of 30 days after the receipt of the policy by the applicant
for purposes of review, during which time the applicant may return
the policy as described in subdivision (e) of Section 10192.17.
   (b) With respect to the standards for basic (core) benefits for
benefit plans A, B, C, D, F, high deductible F, G, M, and N, every
issuer of Medicare supplement insurance benefit plans shall make
available a policy or certificate including only the following basic
"core" package of benefits to each prospective insured. An issuer may
make available to prospective insureds any of the other Medicare
Supplement Insurance Benefit Plans in addition to the basic (core)
package, but not in lieu of it. However, the benefits described in
paragraphs (7) and (8) shall not be offered so long as California is
required to disallow these benefits for Medicare beneficiaries by the
Centers for Medicare and Medicaid Services or other agent of the
federal government under Section 1395ss of Title 42 of the United
States Code.
   (1) Coverage of Part A Medicare eligible expenses for
hospitalization to the extent not covered by Medicare from the 61st
day through the 90th day, inclusive, in any Medicare benefit period.
   (2) Coverage of Part A Medicare eligible expenses incurred for
hospitalization to the extent not covered by Medicare for each
Medicare lifetime inpatient reserve day used.
   (3) Upon exhaustion of the Medicare hospital inpatient coverage,
including the lifetime reserve days, coverage of 100 percent of the
Medicare Part A eligible expenses for hospitalization paid at the
applicable prospective payment system (PPS) rate, or other
appropriate Medicare standard of payment, subject to a lifetime
maximum benefit of an additional 365 days. The provider shall accept
the issuer's payment as payment in full and may not bill the insured
for any balance.
   (4) Coverage under Medicare Parts A and B for the reasonable cost
of the first three pints of blood, or equivalent quantities of packed
red blood cells, as defined under federal regulations, unless
replaced in accordance with federal regulations.
   (5) Coverage for the coinsurance amount, or in the case of
hospital outpatient department services paid under a prospective
payment system, the copayment amount, of Medicare eligible expenses
under Part B regardless of hospital confinement, subject to the
Medicare Part B deductible.
   (6) Coverage of cost sharing for all Part A Medicare eligible
hospice care and respite care expenses.
   (7) Coverage of the actual cost, up to the legally billed amount,
of an annual mammogram as provided in Section 10123.81, to the extent
not paid by Medicare.
   (8) Coverage of the actual cost, up to the legally billed amount,
of an annual cervical cancer screening test as provided in Section
10123.18, to the extent not paid by Medicare.
   (c) The following additional benefits shall be included in
Medicare supplement benefit plans B, C, D, F, high deductible F, G,
M, and N, consistent with the plan type and benefits for each plan as
provided in Section 10192.91:
   (1) With respect to the Medicare Part A deductible, coverage for
100 percent of the Medicare Part A inpatient hospital deductible
amount per benefit period.
   (2) With respect to the Medicare Part A deductible, coverage for
50 percent of the Medicare Part A inpatient hospital deductible
amount per benefit period.
   (3) With respect to skilled nursing facility care, coverage for
the actual billed charges up to the coinsurance amount from the 21st
day through the 100th day in a Medicare benefit period for
posthospital skilled nursing facility care eligible under Medicare
Part A.
   (4) With respect to the Medicare Part B deductible, coverage for
100 percent of the Medicare Part B deductible amount per calendar
year regardless of hospital confinement.
   (5) With respect to 100 percent of the Medicare Part B excess
charges, coverage for all of the difference between the actual
Medicare Part B charges as billed, not to exceed any charge
limitation established by the Medicare Program or state law, and the
Medicare-approved Part B charge.
   (6) With respect to medically necessary emergency care in a
foreign country, coverage to the extent not covered by Medicare for
80 percent of the billed charges for Medicare-eligible expenses for
medically necessary emergency hospital, physician, and medical care
received in a foreign country, which care would have been covered by
Medicare if provided in the United States and which care began during
the first 60 consecutive days of each trip outside the United
States, subject to a calendar year deductible of two hundred fifty
dollars ($250), and a lifetime maximum benefit of fifty thousand
dollars ($50,000). For purposes of this benefit, "emergency care"
shall mean care needed immediately because of an injury or an illness
of sudden and unexpected onset.
  SEC. 147.  Section 10192.12 of the Insurance Code is amended to
read:
   10192.12.  (a) (1) With respect to the guaranteed issue of a
Medicare supplement policy, eligible persons are those individuals
described in subdivision (b) who seek to enroll under the policy
during the period specified in subdivision (c), and who submit
evidence of the date of termination or disenrollment or enrollment in
Medicare Part D with the application for a Medicare supplement
policy.
   (2) With respect to eligible persons, an issuer shall not take any
of the following actions:
   (A) Deny or condition the issuance or effectiveness of a Medicare
supplement policy described in subdivision (e) that is offered and is
available for issuance to new enrollees by the issuer.
   (B) Discriminate in the pricing of that Medicare supplement policy
because of health status, claims experience, receipt of health care,
or medical condition.
   (C) Impose an exclusion of benefits based on a preexisting
condition under that Medicare supplement policy.
   (b) An eligible person is an individual described in any of the
following paragraphs:
   (1) The individual is enrolled under an employee welfare benefit
plan that provides health benefits that supplement the benefits under
Medicare and either of the following applies:
   (A) The plan either terminates or ceases to provide all of those
supplemental health benefits to the individual.
   (B) The employer no longer provides the individual with insurance
that covers all of the payment for the 20-percent coinsurance.
   (2) The individual is enrolled with a Medicare Advantage
organization under a Medicare Advantage plan under Medicare Part C,
and any of the following circumstances apply:
   (A) The certification of the organization or plan has been
terminated.
   (B) The organization has terminated or otherwise discontinued
providing the plan in the area in which the individual resides.
              (C) The individual is no longer eligible to elect the
plan because of a change in the individual's place of residence or
other change in circumstances specified by the secretary. Those
changes in circumstances shall not include termination of the
individual's enrollment on the basis described in Section 1851(g)(3)
(B) of the federal Social Security Act where the individual has not
paid premiums on a timely basis or has engaged in disruptive behavior
as specified in standards under Section 1856 of the federal Social
Security Act, or the plan is terminated for all individuals within a
residence area.
   (D) The Medicare Advantage plan in which the individual is
enrolled reduces any of its benefits or increases the amount of cost
sharing or discontinues for other than good cause relating to quality
of care, its relationship or contract under the plan with a provider
who is currently furnishing services to the individual. An
individual shall be eligible under this subparagraph for a Medicare
supplement policy issued by the same issuer through which the
individual was enrolled at the time the reduction, increase, or
discontinuance described above occurs or, commencing January 1, 2007,
for one issued by a subsidiary of the parent company of that issuer
or by a network that contracts with the parent company of that
issuer.
   (E) The individual demonstrates, in accordance with guidelines
established by the secretary, either of the following:
   (i) The organization offering the plan substantially violated a
material provision of the organization's contract under this article
in relation to the individual, including the failure to provide on a
timely basis medically necessary care for which benefits are
available under the plan or the failure to provide the covered care
in accordance with applicable quality standards.
   (ii) The organization, or agent or other entity acting on the
organization's behalf, materially misrepresented the plan's
provisions in marketing the plan to the individual.
   (F) The individual meets other exceptional conditions as the
secretary may provide.
   (3) The individual is 65 years of age or older, is enrolled with a
Program of All-Inclusive Care for the Elderly (PACE) provider under
Section 1894 of the federal Social Security Act, and circumstances
similar to those described in paragraph (2) exist that would permit
discontinuance of the individual's enrollment with the provider, if
the individual were enrolled in a Medicare Advantage plan.
   (4) The individual meets both of the following conditions:
   (A) The individual is enrolled with any of the following:
   (i) An eligible organization under a contract under Section 1876
of the federal Social Security Act (Medicare cost).
   (ii) A similar organization operating under demonstration project
authority, effective for periods before April 1, 1999.
   (iii) An organization under an agreement under Section 1833(a)(1)
(A) of the federal Social Security Act (health care prepayment plan).

   (iv) An organization under a Medicare Select policy.
   (B) The enrollment ceases under the same circumstances that would
permit discontinuance of an individual's election of coverage under
paragraph (2) or (3).
   (5) The individual is enrolled under a Medicare supplement policy,
and the enrollment ceases because of any of the following
circumstances:
   (A) The insolvency of the issuer or bankruptcy of the nonissuer
organization, or other involuntary termination of coverage or
enrollment under the policy.
   (B) The issuer of the policy substantially violated a material
provision of the policy.
   (C) The issuer, or an agent or other entity acting on the issuer's
behalf, materially misrepresented the policy's provisions in
marketing the policy to the individual.
   (6) The individual meets both of the following conditions:
   (A) The individual was enrolled under a Medicare supplement policy
and terminates enrollment and subsequently enrolls, for the first
time, with any Medicare Advantage organization under a Medicare
Advantage plan under Medicare Part C, any eligible organization under
a contract under Section 1876 of the federal Social Security Act
(Medicare cost), any similar organization operating under
demonstration project authority, any PACE provider under Section 1894
of the federal Social Security Act, or a Medicare Select policy.
   (B) The subsequent enrollment under subparagraph (A) is terminated
by the individual during any period within the first 12 months of
the subsequent enrollment (during which the enrollee is permitted to
terminate the subsequent enrollment under Section 1851(e) of the
federal Social Security Act).
   (7) The individual upon first becoming eligible for benefits under
Medicare Part A at 65 years of age enrolls in a Medicare Advantage
plan under Medicare Part C or with a PACE provider under Section 1894
of the federal Social Security Act, and disenrolls from the plan or
program not later than 12 months after the effective date of
enrollment.
   (8) The individual while enrolled under a Medicare supplement
policy that covers outpatient prescription drugs enrolls in a
Medicare Part D plan during the initial enrollment period terminates
enrollment in the Medicare supplement policy, and submits evidence of
enrollment in Medicare Part D along with the application for a
policy described in paragraph (4) of subdivision (e).
   (c) (1) In the case of an individual described in paragraph (1) of
subdivision (b), the guaranteed issue period begins on the later of
the following two dates and ends on the date that is 63 days after
the date the applicable coverage terminates:
   (A) The date the individual receives a notice of termination or
cessation of all supplemental health benefits or, if no notice is
received, the date of the notice denying a claim because of a
termination or cessation of benefits.
   (B) The date that the applicable coverage terminates or ceases.
   (2) In the case of an individual described in paragraphs (2), (3),
(4), (6), and (7) of subdivision (b) whose enrollment is terminated
involuntarily, the guaranteed issue period begins on the date that
the individual receives a notice of termination and ends 63 days
after the date the applicable coverage is terminated.
   (3) In the case of an individual described in subparagraph (A) of
paragraph (5) of subdivision (b), the guaranteed issue period begins
on the earlier of the following two dates and ends on the date that
is 63 days after the date the coverage is terminated:
   (A) The date that the individual receives a notice of termination,
a notice of the issuer's bankruptcy or insolvency, or other similar
notice if any.
   (B) The date that the applicable coverage is terminated.
   (4) In the case of an individual described in paragraph (2), (3),
(6), or (7) of, or in subparagraph (B) or (C) of paragraph (5) of,
subdivision (b) who disenrolls voluntarily, the guaranteed issue
period begins on the date that is 60 days before the effective date
of the disenrollment and ends on the date that is 63 days after the
effective date of the disenrollment.
   (5) In the case of an individual described in paragraph (8) of
subdivision (b), the guaranteed issue period begins on the date the
individual receives notice pursuant to Section 1882(v)(2)(B) of the
federal Social Security Act from the Medicare supplement issuer
during the 60-day period immediately preceding the initial enrollment
period for Medicare Part D and ends on the date that is 63 days
after the effective date of the individual's coverage under Medicare
Part D.
   (6) In the case of an individual described in subdivision (b) who
is not included in this subdivision, the guaranteed issue period
begins on the effective date of disenrollment and ends on the date
that is 63 days after the effective date of disenrollment.
   (d) (1) In the case of an individual described in paragraph (6) of
subdivision (b), or deemed to be so described pursuant to this
paragraph, whose enrollment with an organization or provider
described in subparagraph (A) of paragraph (6) of subdivision (b) is
involuntarily terminated within the first 12 months of enrollment and
who, without an intervening enrollment, enrolls with another such
organization or provider, the subsequent enrollment shall be deemed
to be an initial enrollment described in paragraph (6) of subdivision
(b).
   (2) In the case of an individual described in paragraph (7) of
subdivision (b), or deemed to be so described pursuant to this
paragraph, whose enrollment with a plan or in a program described in
paragraph (7) of subdivision (b) is involuntarily terminated within
the first 12 months of enrollment and who, without an intervening
enrollment, enrolls in another such plan or program, the subsequent
enrollment shall be deemed to be an initial enrollment described in
paragraph (7) of subdivision (b).
   (3) For purposes of paragraphs (6) and (7) of subdivision (b), an
enrollment of an individual with an organization or provider
described in subparagraph (A) of paragraph (6) of subdivision (b), or
with a plan or in a program described in paragraph (7) of
subdivision (b) shall not be deemed to be an initial enrollment under
this paragraph after the two-year period beginning on the date on
which the individual first enrolled with such an organization,
provider, plan, or program.
   (e) (1) Under paragraphs (1), (2), (3), (4), and (5) of
subdivision (b), an eligible individual is entitled to a Medicare
supplement policy that has a benefit package classified as Plan A, B,
C, F (including a high deductible Plan F), K, or L offered by any
issuer.
   (2) (A) Under paragraph (6) of subdivision (b), an eligible
individual is entitled to the same Medicare supplement policy in
which he or she was most recently enrolled, if available from the
same issuer. If that policy is not available, the eligible individual
is entitled to a Medicare supplement policy that has a benefit
package classified as Plan A, B, C, F (including a high deductible
Plan F), K, or L offered by any issuer.
   (B) On and after January 1, 2006, an eligible individual described
in this paragraph who was most recently enrolled in a Medicare
supplement policy with an outpatient prescription drug benefit is
entitled to a Medicare supplement policy that is available from the
same issuer but without an outpatient prescription drug benefit or,
at the election of the individual, has a benefit package classified
as a Plan A, B, C, F (including high deductible Plan F), K, or L that
is offered by any issuer.
   (3) Under paragraph (7) of subdivision (b), an eligible individual
is entitled to any Medicare supplement policy offered by any issuer.

   (4) Under paragraph (8) of subdivision (b), an eligible individual
is entitled to a Medicare supplement policy that has a benefit
package classified as Plan A, B, C, F (including a high deductible
Plan F), K, or L and that is offered and is available for issuance to
a new enrollee by the same issuer that issued the individual's
Medicare supplement policy with outpatient prescription drug
coverage.
   (f) (1) At the time of an event described in subdivision (b) by
which an individual loses coverage or benefits due to the termination
of a contract or agreement, policy, or plan, the organization that
terminates the contract or agreement, the issuer terminating the
policy, or the administrator of the plan being terminated,
respectively, shall notify the individual of his or her rights under
this section and of the obligations of issuers of Medicare supplement
policies under subdivision (a). The notice shall be communicated
contemporaneously with the notification of termination.
   (2) At the time of an event described in subdivision (b) by which
an individual ceases enrollment under a contract or agreement,
policy, or plan, the organization that offers the contract or
agreement, regardless of the basis for the cessation of enrollment,
the issuer offering the policy, or the administrator of the plan,
respectively, shall notify the individual of his or her rights under
this section, and of the obligations of issuers of Medicare
supplement policies under subdivision (a). The notice shall be
communicated within 10 working days of the date the issuer received
notification of disenrollment.
   (g) An issuer shall refund any unearned premium that an insured
paid in advance and shall terminate coverage upon the request of an
insured.
  SEC. 148.  Section 10192.20 of the Insurance Code is amended to
read:
   10192.20.  (a) An issuer, directly or through its producers, shall
do each of the following:
   (1) Establish marketing procedures to ensure that any comparison
of policies by its agents or other producers will be fair and
accurate.
   (2) Establish marketing procedures to ensure that excessive
insurance is not sold or issued.
   (3) Display prominently by type, stamp, or other appropriate
means, on the first page of the policy, the following:

   "Notice to buyer: This policy may not cover all of your medical
expenses."

   (4) Inquire and otherwise make every reasonable effort to identify
whether a prospective applicant for a Medicare supplement policy
already has health insurance and the types and amounts of that
insurance.
   (5) Establish auditable procedures for verifying compliance with
this subdivision.
   (b) In addition to the practices prohibited by this code or any
other law, the following acts and practices are prohibited:
   (1) Twisting, which means knowingly making any misleading
representation or incomplete or fraudulent comparison of any
insurance policies or insurers for the purpose of inducing or tending
to induce, any person to lapse, forfeit, surrender, terminate,
retain, pledge, assign, borrow on, or convert an insurance policy or
to take out a policy of insurance with another insurer.
   (2) High pressure tactics, which means employing any method of
marketing having the effect of or tending to induce the purchase of
insurance through force, fright, threat, whether explicit or implied,
or undue pressure to purchase or recommend the purchase of
insurance.
   (3) Cold lead advertising, which means making use directly or
indirectly of any method of marketing that fails to disclose in a
conspicuous manner that a purpose of the method of marketing is the
solicitation of insurance and that contact will be made by an
insurance agent or insurance company.
   (c) The terms "Medicare supplement," "Medigap," "Medicare
Wrap-Around" and words of similar import shall not be used unless the
policy is issued in compliance with this article.
   (d) The commissioner each year shall prepare a rate guide for
Medicare supplement insurance and Medicare supplement contracts. The
commissioner each year shall make the rate guide available on or
before the date of the fall Medicare annual open enrollment. The rate
guide shall include all of the following for each company that sells
Medicare supplemental insurance or Medicare supplement contracts in
California:
   (1) (A) For policies sold for effective dates prior to June 1,
2010, a listing of all the policies, plans A to L, inclusive, that
are available from the company.
   (B) For policies sold for effective dates on or after June 1,
2010, a listing of all the policies, plans A to D, inclusive, F, high
deductible F, G, and K to N, inclusive, that are available from the
company.
   (2) (A) For policies sold for effective dates prior to June 1,
2010, a listing of all the policies, plans A to L, inclusive, for
Medicare beneficiaries under 65 years of age that are available from
the company.
   (B) For policies sold for effective dates on or after June 1,
2010, a listing of all the policies, plans, A to D, inclusive, F,
high deductible F, G, and K to N, inclusive, for Medicare
beneficiaries under 65 years of age that are available from the
company.
   (3) The toll-free telephone number of the company that consumers
can use to obtain information from the company.
   (4) Sample rates for each policy listed pursuant to paragraphs (1)
and (2). The sample rates shall be for ages 0-65, 65, 70, 75, and
80.
   (5) The premium rate methodology for each policy listed pursuant
to paragraphs (1) and (2). "Premium rate methodology" means attained
age, issue age, or community rated.
   (6) The waiting period for preexisting conditions for each policy
listed pursuant to paragraphs (1) and (2).
   (e) The consumer rate guide prepared pursuant to subdivision (d)
shall be distributed using all of the following methods:
   (1) Through Health Insurance Counseling and Advocacy Program
(HICAP) offices.
   (2) By telephone, using the department's consumer toll-free
telephone number.
   (3) On the department's Internet Web site.
   (4) In addition to the distribution methods described in
paragraphs (1) to (3), inclusive, each insurer that markets Medicare
supplement insurance or Medicare supplement contracts in this state
shall provide on the application form a statement that reads as
follows: "A rate guide is available that compares the policies sold
by different insurers. You can obtain a copy of this rate guide by
calling the Department of Insurance's consumer toll-free telephone
number (1-800-927-HELP), by calling the Health Insurance Counseling
and Advocacy Program (HICAP) toll-free telephone number
(1-800-434-0222), or by accessing the Department of Insurance's
Internet Web site (www.insurance.ca.gov)."
  SEC. 149.  Section 10198.6 of the Insurance Code is amended to
read:
   10198.6.  For purposes of this article:
   (a) "Health benefit plan" means any group or individual policy or
contract that provides medical, hospital, or surgical benefits. The
term does not include accident only, credit, disability income,
coverage of Medicare services pursuant to contracts with the United
States government, Medicare supplement, long-term care insurance,
dental, vision, coverage issued as a supplement to liability
insurance, insurance arising out of a workers' compensation or
similar law, automobile medical payment insurance, or insurance under
which benefits are payable with or without regard to fault and that
is statutorily required to be contained in any liability insurance
policy or equivalent self-insurance.
   (b) "Late enrollee" means an eligible employee or dependent who
has declined health coverage under a health benefit plan offered
through employment or sponsored by an employer at the time of the
initial enrollment period provided under the terms of the health
benefit plan, and who subsequently requests enrollment in a health
benefit plan of that employer, provided that the initial enrollment
period shall be a period of at least 30 days. However, an eligible
employee or dependent shall not be considered a late enrollee if any
of the following is applicable:
   (1) The individual meets all of the following requirements:
   (A) The individual was covered under another employer health
benefit plan, the Healthy Families Program, the Access for Infants
and Mothers (AIM) Program, or the Medi-Cal program at the time the
individual was eligible to enroll.
   (B) The individual certified, at the time of the initial
enrollment that coverage under another employer health benefit plan,
the Healthy Families Program, the AIM Program, or the Medi-Cal
program was the reason for declining enrollment provided that, if the
individual was covered under another employer health benefit plan,
the individual was given the opportunity to make the certification
required by this subdivision and was notified that failure to do so
could result in later treatment as a late enrollee.
   (C) The individual has lost or will lose coverage under another
employer health benefit plan as a result of termination of employment
of the individual or of a person through whom the individual was
covered as a dependent, change in employment status of the individual
or of a person through whom the individual was covered as a
dependent, termination of the other plan's coverage, cessation of an
employer's contribution toward an employee or dependent's coverage,
death of a person through whom the individual was covered as a
dependent, legal separation, or divorce; or the individual has lost
or will lose coverage under the Healthy Families Program, the AIM
Program, or the Medi-Cal program.
   (D) The individual requests enrollment within 30 days after
termination of coverage, or cessation of employer contribution toward
coverage provided under another employer health benefit plan, or
requests enrollment within 60 days after termination of Medi-Cal
program coverage, AIM Program coverage, or Healthy Families Program
coverage.
   (2) The individual is employed by an employer that offers multiple
health benefit plans and the individual elects a different plan
during an open enrollment period.
   (3) A court has ordered that coverage be provided for a spouse or
minor child under a covered employee's health benefit plan.
   (4) The carrier cannot produce a written statement from the
employer stating that, prior to declining coverage, the individual or
the person through whom the individual was eligible to be covered as
a dependent was provided with, and signed acknowledgment of,
explicit written notice in boldface type specifying that failure to
elect coverage during the initial enrollment period permits the
carrier to impose, at the time of the individual's later decision to
elect coverage, an exclusion from coverage for a period of 12 months
as well as a six-month preexisting condition exclusion, unless the
individual meets the criteria specified in paragraph (1), (2), or
(3).
   (5) The individual is an employee or dependent who meets the
criteria described in paragraph (1) and was under a COBRA
continuation provision and the coverage under that provision has been
exhausted. For purposes of this section, the definition of "COBRA"
set forth in subdivision (e) of Section 10116.5 shall apply.
   (6) The individual is a dependent of an enrolled eligible employee
who has lost or will lose his or her coverage under the Healthy
Families Program, the AIM Program, or the Medi-Cal program and
requests enrollment within 60 days of termination of that coverage.
   (c) "Preexisting condition provision" means a policy provision
that excludes coverage for charges or expenses incurred during a
specified period following the insured's effective date of coverage,
as to a condition for which medical advice, diagnosis, care, or
treatment was recommended or received during a specified period
immediately preceding the effective date of coverage.
   (d) "Creditable coverage" means:
   (1) Any individual or group policy, contract or program, that is
written or administered by a disability insurance company, health
care service plan, fraternal benefits society, self-insured employer
plan, or any other entity, in this state or elsewhere, and that
arranges or provides medical, hospital, and surgical coverage not
designed to supplement other private or governmental plans. The term
includes continuation or conversion coverage but does not include
accident only, credit, coverage for onsite medical clinics,
disability income, Medicare supplement, long-term care insurance,
dental, vision, coverage issued as a supplement to liability
insurance, insurance arising out of a workers' compensation or
similar law, automobile medical payment insurance, or insurance under
which benefits are payable with or without regard to fault and that
is statutorily required to be contained in any liability insurance
policy or equivalent self-insurance.
   (2) The federal Medicare Program pursuant to Title XVIII of the
federal Social Security Act (42 U.S.C. Sec. 1395 et seq.).
   (3) The Medicaid Program pursuant to Title XIX of the federal
Social Security Act (42 U.S.C. Sec. 1396 et seq.).
   (4) Any other publicly sponsored program, provided in this state
or elsewhere, of medical, hospital, and surgical care.
   (5) 10 U.S.C. Chapter 55 (commencing with Section 1071) (Civilian
Health and Medical Program of the Uniformed Services (CHAMPUS)).
   (6) A medical care program of the Indian Health Service or of a
tribal organization.
   (7) A state health benefits risk pool.
   (8) A health plan offered under 5 U.S.C. Chapter 89 (commencing
with Section 8901) (Federal Employees Health Benefits Program
(FEHBP)).
   (9) A public health plan as defined in federal regulations
authorized by Section 2701(c)(1)(I) of the federal Public Health
Service Act, as amended by Public Law 104-191, the federal Health
Insurance Portability and Accountability Act of 1996.
   (10) A health benefit plan under Section 5(e) of the federal Peace
Corps Act (22 U.S.C. Sec. 2504(e)).
   (11) Any other creditable coverage as defined by subsection (c) of
Section 2701 of Title XXVII of the federal Public Health Service Act
(42 U.S.C. Sec. 300gg(c)).
   (e) "Affiliation period" means a period that, under the terms of
the health benefit plan, must expire before health care services
under the plan become effective.
   (f) "Waivered condition" means a contract provision that excludes
coverage for charges or expenses incurred during a specified period
of time for one or more specific, identified, medical conditions.
  SEC. 150.  Section 10700 of the Insurance Code is amended to read:
   10700.  As used in this chapter:
   (a) "Agent or broker" means a person or entity licensed under
Chapter 5 (commencing with Section 1621) of Part 2 of Division 1.
   (b) "Benefit plan design" means a specific health coverage product
issued by a carrier to small employers, to trustees of associations
that include small employers, or to individuals if the coverage is
offered through employment or sponsored by an employer. It includes
services covered and the levels of copayment and deductibles, and it
may include the professional providers who are to provide those
services and the sites where those services are to be provided. A
benefit plan design may also be an integrated system for the
financing and delivery of quality health care services which has
significant incentives for the covered individuals to use the system.

   (c) "Board" means the Major Risk Medical Insurance Board.
   (d) "Carrier" means any disability insurance company or any other
entity that writes, issues, or administers health benefit plans that
cover the employees of small employers, regardless of the situs of
the contract or master policyholder. For the purposes of Articles 3
(commencing with Section 10719) and 4 (commencing with Section
10730), "carrier" also includes health care service plans.
   (e) "Dependent" means the spouse or child of an eligible employee,
subject to applicable terms of the health benefit plan covering the
employee, and includes dependents of guaranteed association members
if                                                  the association
elects to include dependents under its health coverage at the same
time it determines its membership composition pursuant to subdivision
(z).
   (f) "Eligible employee" means either of the following:
   (1) Any permanent employee who is actively engaged on a full-time
basis in the conduct of the business of the small employer with a
normal workweek of at least 30 hours, in the small employer's regular
place of business, who has met any statutorily authorized applicable
waiting period requirements. The term includes sole proprietors or
partners of a partnership, if they are actively engaged on a
full-time basis in the small employer's business, and they are
included as employees under a health benefit plan of a small
employer, but does not include employees who work on a part-time,
temporary, or substitute basis. It includes any eligible employee, as
defined in this paragraph, who obtains coverage through a guaranteed
association. Employees of employers purchasing through a guaranteed
association shall be deemed to be eligible employees if they would
otherwise meet the definition except for the number of persons
employed by the employer. A permanent employee who works at least 20
hours but not more than 29 hours is deemed to be an eligible employee
if all four of the following apply:
   (A) The employee otherwise meets the definition of an eligible
employee except for the number of hours worked.
   (B) The employer offers the employee health coverage under a
health benefit plan.
   (C) All similarly situated individuals are offered coverage under
the health benefit plan.
   (D) The employee must have worked at least 20 hours per normal
workweek for at least 50 percent of the weeks in the previous
calendar quarter. The insurer may request any necessary information
to document the hours and time period in question, including, but not
limited to, payroll records and employee wage and tax filings.
   (2) Any member of a guaranteed association as defined in
subdivision (z).
   (g) "Enrollee" means an eligible employee or dependent who
receives health coverage through the program from a participating
carrier.
   (h) "Financially impaired" means, for the purposes of this
chapter, a carrier that, on or after the effective date of this
chapter, is not insolvent and is either:
   (1) Deemed by the commissioner to be potentially unable to fulfill
its contractual obligations.
   (2) Placed under an order of rehabilitation or conservation by a
court of competent jurisdiction.
   (i) "Fund" means the California Small Group Reinsurance Fund.
   (j) "Health benefit plan" means a policy or contract written or
administered by a carrier that arranges or provides health care
benefits for the covered eligible employees of a small employer and
their dependents. The term does not include accident only, credit,
disability income, coverage of Medicare services pursuant to
contracts with the United States government, Medicare supplement,
long-term care insurance, dental, vision, coverage issued as a
supplement to liability insurance, automobile medical payment
insurance, or insurance under which benefits are payable with or
without regard to fault and that is statutorily required to be
contained in any liability insurance policy or equivalent
self-insurance.
   (k) "In force business" means an existing health benefit plan
issued by the carrier to a small employer.
   (l) "Late enrollee" means an eligible employee or dependent who
has declined health coverage under a health benefit plan offered by a
small employer at the time of the initial enrollment period provided
under the terms of the health benefit plan and who subsequently
requests enrollment in a health benefit plan of that small employer,
provided that the initial enrollment period shall be a period of at
least 30 days. It also means any member of an association that is a
guaranteed association as well as any other person eligible to
purchase through the guaranteed association when that person has
failed to purchase coverage during the initial enrollment period
provided under the terms of the guaranteed association's health
benefit plan and who subsequently requests enrollment in the plan,
provided that the initial enrollment period shall be a period of at
least 30 days. However, an eligible employee, another person eligible
for coverage through a guaranteed association pursuant to
subdivision (z), or an eligible dependent shall not be considered a
late enrollee if any of the following is applicable:
   (1) The individual meets all of the following requirements:
   (A) He or she was covered under another employer health benefit
plan, the Healthy Families Program, the Access for Infants and
Mothers (AIM) Program, or the Medi-Cal program at the time the
individual was eligible to enroll.
   (B) He or she certified at the time of the initial enrollment that
coverage under another employer health benefit plan, the Healthy
Families Program, the AIM Program, or the Medi-Cal program was the
reason for declining enrollment provided that, if the individual was
covered under another employer health plan, the individual was given
the opportunity to make the certification required by this
subdivision and was notified that failure to do so could result in
later treatment as a late enrollee.
   (C) He or she has lost or will lose coverage under another
employer health benefit plan as a result of termination of employment
of the individual or of a person through whom the individual was
covered as a dependent, change in employment status of the
individual, or of a person through whom the individual was covered as
a dependent, the termination of the other plan's coverage, cessation
of an employer's contribution toward an employee or dependent's
coverage, death of the person through whom the individual was covered
as a dependent, legal separation, or divorce; or he or she has lost
or will lose coverage under the Healthy Families Program, the AIM
Program, or the Medi-Cal program.
   (D) He or she requests enrollment within 30 days after termination
of coverage or employer contribution toward coverage provided under
another employer health benefit plan, or requests enrollment within
60 days after termination of Medi-Cal program coverage, AIM Program
coverage, or Healthy Families Program coverage.
   (2) The individual is employed by an employer who offers multiple
health benefit plans and the individual elects a different plan
during an open enrollment period.
   (3) A court has ordered that coverage be provided for a spouse or
minor child under a covered employee's health benefit plan.
   (4) (A) In the case of an eligible employee as defined in
paragraph (1) of subdivision (f), the carrier cannot produce a
written statement from the employer stating that the individual or
the person through whom an individual was eligible to be covered as a
dependent, prior to declining coverage, was provided with, and
signed acknowledgment of, an explicit written notice in boldface type
specifying that failure to elect coverage during the initial
enrollment period permits the carrier to impose, at the time of the
individual's later decision to elect coverage, an exclusion from
coverage for a period of 12 months as well as a six-month preexisting
condition exclusion unless the individual meets the criteria
specified in paragraph (1), (2), or (3).
   (B) In the case of an eligible employee who is a guaranteed
association member, the plan cannot produce a written statement from
the guaranteed association stating that the association sent a
written notice in boldface type to all potentially eligible
association members at their last known address prior to the initial
enrollment period informing members that failure to elect coverage
during the initial enrollment period permits the plan to impose, at
the time of the member's later decision to elect coverage, an
exclusion from coverage for a period of 12 months as well as a
six-month preexisting condition exclusion unless the member can
demonstrate that he or she meets the requirements of subparagraphs
(A), (C), and (D) of paragraph (1) or meets the requirements of
paragraph (2) or (3).
   (C) In the case of an employer or person who is not a member of an
association, was eligible to purchase coverage through a guaranteed
association, and did not do so, and would not be eligible to purchase
guaranteed coverage unless purchased through a guaranteed
association, the employer or person can demonstrate that he or she
meets the requirements of subparagraphs (A), (C), and (D) of
paragraph (1), or meets the requirements of paragraph (2) or (3), or
that he or she recently had a change in status that would make him or
her eligible and that application for coverage was made within 30
days of the change.
   (5) The individual is an employee or dependent who meets the
criteria described in paragraph (1) and was under a COBRA
continuation provision and the coverage under that provision has been
exhausted. For purposes of this section, the definition of "COBRA"
set forth in subdivision (e) of Section 10116.5 shall apply.
   (6) The individual is a dependent of an enrolled eligible employee
who has lost or will lose his or her coverage under the Healthy
Families Program, the AIM Program, or the Medi-Cal program and
requests enrollment within 60 days after termination of that
coverage.
   (7) The individual is an eligible employee who previously declined
coverage under an employer health benefit plan and who has
subsequently acquired a dependent who would be eligible for coverage
as a dependent of the employee through marriage, birth, adoption, or
placement for adoption, and who enrolls for coverage under that
employer health benefit plan on his or her behalf and on behalf of
his or her dependent within 30 days following the date of marriage,
birth, adoption, or placement for adoption, in which case the
effective date of coverage shall be the first day of the month
following the date the completed request for enrollment is received
in the case of marriage, or the date of birth, or the date of
adoption or placement for adoption, whichever applies. Notice of the
special enrollment rights contained in this paragraph shall be
provided by the employer to an employee at or before the time the
employee is offered an opportunity to enroll in plan coverage.
   (8) The individual is an eligible employee who has declined
coverage for himself or herself or his or her dependents during a
previous enrollment period because his or her dependents were covered
by another employer health benefit plan at the time of the previous
enrollment period. That individual may enroll himself or herself or
his or her dependents for plan coverage during a special open
enrollment opportunity if his or her dependents have lost or will
lose coverage under that other employer health benefit plan. The
special open enrollment opportunity shall be requested by the
employee not more than 30 days after the date that the other health
coverage is exhausted or terminated. Upon enrollment, coverage shall
be effective not later than the first day of the first calendar month
beginning after the date the request for enrollment is received.
Notice of the special enrollment rights contained in this paragraph
shall be provided by the employer to an employee at or before the
time the employee is offered an opportunity to enroll in plan
coverage.
   (m) "New business" means a health benefit plan issued to a small
employer that is not the carrier's in force business.
   (n) "Participating carrier" means a carrier that has entered into
a contract with the program to provide health benefits coverage under
this part.
   (o) "Plan of operation" means the plan of operation of the fund,
including articles, bylaws, and operating rules adopted by the fund
pursuant to Article 3 (commencing with Section 10719).
   (p) "Program" means the Health Insurance Plan of California.
   (q) "Preexisting condition provision" means a policy provision
that excludes coverage for charges or expenses incurred during a
specified period following the insured's effective date of coverage,
as to a condition for which medical advice, diagnosis, care, or
treatment was recommended or received during a specified period
immediately preceding the effective date of coverage.
   (r) "Creditable coverage" means:
   (1) Any individual or group policy, contract, or program, that is
written or administered by a disability insurer, health care service
plan, fraternal benefits society, self-insured employer plan, or any
other entity, in this state or elsewhere, and that arranges or
provides medical, hospital, and surgical coverage not designed to
supplement other private or governmental plans. The term includes
continuation or conversion coverage but does not include accident
only, credit, coverage for onsite medical clinics, disability income,
Medicare supplement, long-term care, dental, vision, coverage issued
as a supplement to liability insurance, insurance arising out of a
workers' compensation or similar law, automobile medical payment
insurance, or insurance under which benefits are payable with or
without regard to fault and that is statutorily required to be
contained in any liability insurance policy or equivalent
self-insurance.
   (2) The federal Medicare Program pursuant to Title XVIII of the
federal Social Security Act (42 U.S.C. Sec. 1395 et seq.).
   (3) The Medicaid Program pursuant to Title XIX of the federal
Social Security Act (42 U.S.C. Sec. 1396 et seq.).
   (4) Any other publicly sponsored program, provided in this state
or elsewhere, of medical, hospital, and surgical care.
   (5) 10 U.S.C. Chapter 55 (commencing with Section 1071) (Civilian
Health and Medical Program of the Uniformed Services (CHAMPUS)).
   (6) A medical care program of the Indian Health Service or of a
tribal organization.
   (7) A state health benefits risk pool.
   (8) A health plan offered under 5 U.S.C. Chapter 89 (commencing
with Section 8901) (Federal Employees Health Benefits Program
(FEHBP)).
   (9) A public health plan as defined in federal regulations
authorized by Section 2701(c)(1)(I) of the federal Public Health
Service Act, as amended by Public Law 104-191, the federal Health
Insurance Portability and Accountability Act of 1996.
   (10) A health benefit plan under Section 5(e) of the federal Peace
Corps Act (22 U.S.C. Sec. 2504(e)).
   (11) Any other creditable coverage as defined by subdivision (c)
of Section 2701 of Title XXVII of the federal Public Health Service
Act (42 U.S.C. Sec. 300gg(c)).
   (s) "Rating period" means the period for which premium rates
established by a carrier are in effect and shall be no less than six
months.
   (t) "Risk adjusted employee risk rate" means the rate determined
for an eligible employee of a small employer in a particular risk
category after applying the risk adjustment factor.
   (u) "Risk adjustment factor" means the percent adjustment to be
applied equally to each standard employee risk rate for a particular
small employer, based upon any expected deviations from standard
claims. This factor may not be more than 120 percent or less than 80
percent until July 1, 1996. Effective July 1, 1996, this factor may
not be more than 110 percent or less than 90 percent.
   (v) "Risk category" means the following characteristics of an
eligible employee: age, geographic region, and family size of the
employee, plus the benefit plan design selected by the small
employer.
   (1) No more than the following age categories may be used in
determining premium rates:
   Under 30
   30-39
   40-49
   50-54
   55-59
   60-64
   65 and over
   However, for the 65 and over age category, separate premium rates
may be specified depending upon whether coverage under the health
benefit plan will be primary or secondary to benefits provided by the
federal Medicare Program pursuant to Title XVIII of the federal
Social Security Act.
   (2) Small employer carriers shall base rates to small employers
using no more than the following family size categories:
   (A) Single.
   (B) Married couple.
   (C) One adult and child or children.
   (D) Married couple and child or children.
   (3) (A) In determining rates for small employers, a carrier that
operates statewide shall use no more than nine geographic regions in
the state, have no region smaller than an area in which the first
three digits of all its ZIP Codes are in common within a county, and
shall divide no county into more than two regions. Carriers shall be
deemed to be operating statewide if their coverage area includes 90
percent or more of the state's population. Geographic regions
established pursuant to this section shall, as a group, cover the
entire state, and the area encompassed in a geographic region shall
be separate and distinct from areas encompassed in other geographic
regions. Geographic regions may be noncontiguous.
   (B) In determining rates for small employers, a carrier that does
not operate statewide shall use no more than the number of geographic
regions in the state than is determined by the following formula:
the population, as determined in the last federal census, of all
counties which are included in their entirety in a carrier's service
area divided by the total population of the state, as determined in
the last federal census, multiplied by nine. The resulting number
shall be rounded to the nearest whole integer. No region may be
smaller than an area in which the first three digits of all its ZIP
Codes are in common within a county and no county may be divided into
more than two regions. The area encompassed in a geographic region
shall be separate and distinct from areas encompassed in other
geographic regions. Geographic regions may be noncontiguous. No
carrier shall have less than one geographic area.
   (w) "Small employer" means either of the following:
   (1) Any person, proprietary or nonprofit firm, corporation,
partnership, public agency, or association that is actively engaged
in business or service that, on at least 50 percent of its working
days during the preceding calendar quarter, or preceding calendar
year, employed at least 2, but not more than 50, eligible employees,
the majority of whom were employed within this state, that was not
formed primarily for purposes of buying health insurance and in which
a bona fide employer-employee relationship exists. In determining
whether to apply the calendar quarter or calendar year test, the
insurer shall use the test that ensures eligibility if only one test
would establish eligibility. However, for purposes of subdivisions
(b) and (h) of Section 10705, the definition shall include employers
with at least three eligible employees until July 1, 1997, and two
eligible employees thereafter. In determining the number of eligible
employees, companies that are affiliated companies and that are
eligible to file a combined income tax return for purposes of state
taxation shall be considered one employer. Subsequent to the issuance
of a health benefit plan to a small employer pursuant to this
chapter, and for the purpose of determining eligibility, the size of
a small employer shall be determined annually. Except as otherwise
specifically provided, provisions of this chapter that apply to a
small employer shall continue to apply until the health benefit plan
anniversary following the date the employer no longer meets the
requirements of this definition. It includes any small employer as
defined in this paragraph who purchases coverage through a guaranteed
association, and any employer purchasing coverage for employees
through a guaranteed association.
   (2) Any guaranteed association, as defined in subdivision (y),
that purchases health coverage for members of the association.
   (x) "Standard employee risk rate" means the rate applicable to an
eligible employee in a particular risk category in a small employer
group.
   (y) "Guaranteed association" means a nonprofit organization
comprised of a group of individuals or employers who associate based
solely on participation in a specified profession or industry,
accepting for membership any individual or employer meeting its
membership criteria which (1) includes one or more small employers as
defined in paragraph (1) of subdivision (w), (2) does not condition
membership directly or indirectly on the health or claims history of
any person, (3) uses membership dues solely for and in consideration
of the membership and membership benefits, except that the amount of
the dues shall not depend on whether the member applies for or
purchases insurance offered by the association, (4) is organized and
maintained in good faith for purposes unrelated to insurance, (5) has
been in active existence on January 1, 1992, and for at least five
years prior to that date, (6) has been offering health insurance to
its members for at least five years prior to January 1, 1992, (7) has
a constitution and bylaws, or other analogous governing documents
that provide for election of the governing board of the association
by its members, (8) offers any benefit plan design that is purchased
to all individual members and employer members in this state, (9)
includes any member choosing to enroll in the benefit plan design
offered to the association provided that the member has agreed to
make the required premium payments, and (10) covers at least 1,000
persons with the carrier with which it contracts. The requirement of
1,000 persons may be met if component chapters of a statewide
association contracting separately with the same carrier cover at
least 1,000 persons in the aggregate.
   This subdivision applies regardless of whether a master policy by
an admitted insurer is delivered directly to the association or a
trust formed for or sponsored by an association to administer
benefits for association members.
   For purposes of this subdivision, an association formed by a
merger of two or more associations after January 1, 1992, and
otherwise meeting the criteria of this subdivision shall be deemed to
have been in active existence on January 1, 1992, if its predecessor
organizations had been in active existence on January 1, 1992, and
for at least five years prior to that date and otherwise met the
criteria of this subdivision.
   (z) "Members of a guaranteed association" means any individual or
employer meeting the association's membership criteria if that person
is a member of the association and chooses to purchase health
coverage through the association. At the association's discretion, it
may also include employees of association members, association
staff, retired members, retired employees of members, and surviving
spouses and dependents of deceased members. However, if an
association chooses to include those persons as members of the
guaranteed association, the association must so elect in advance of
purchasing coverage from a plan. Health plans may require an
association to adhere to the membership composition it selects for up
to 12 months.
   (aa) "Affiliation period" means a period that, under the terms of
the health benefit plan, must expire before health care services
under the plan become effective.
  SEC. 150.5.  Section 226.6 of the Labor Code is amended to read:
   226.6.  Any employer who knowingly and intentionally violates the
provisions of Section 226, or any officer, agent, employee,
fiduciary, or other person who has the control, receipt, custody, or
disposal of, or pays, the wages due any employee, and who knowingly
and intentionally participates or aids in the violation of any
provision of Section 226 is guilty of a misdemeanor and, upon
conviction thereof, shall be fined not more than one thousand dollars
($1,000) or be imprisoned not to exceed one year, or both, at the
discretion of the court. That fine or imprisonment, or both, shall be
in addition to any other penalty provided by law.
  SEC. 151.  Section 273 of the Labor Code is amended to read:
   273.  (a) The following definitions apply for purposes of this
section:
   (1) "All activities relating to an adverse license or registration
action" includes, but is not limited to, all of the following which
occur as a result of a failure to comply with this section:
   (A) Denial of a new application or a renewal application for
licensure or registration.
   (B) Denial of reinstatement of a license or registration.
   (C) Suspension of a license or registration.
   (D) Assessment and recovery of civil penalties for knowingly
providing false information in the statement required by paragraph
(1) of subdivision (b).
   (2) "Farm labor contractor" has the same meaning as set forth in
Section 1682.
   (3) "Final judgment issued by a court" means a judgment with
respect to which all possibility of a direct attack, by way of
appeal, motion for a new trial, or motion pursuant to Section 663 of
the Code of Civil Procedure to vacate the judgment, has been
exhausted and also includes any final arbitration award where the
time to file a petition for a trial de novo or a petition to vacate
or correct the arbitration award has expired, and no petition is
pending.
   (4) "Garment manufacturer" means a person engaged in garment
manufacturing as described in Section 2671.
   (5) "Involving unpaid wages" means all amounts required to be paid
by a final judgment, order, or accord involving a failure of the
licensee or registrant to pay required wages.
   (6) "Licensee" has the same meaning as set forth in Section 1682.
   (7) "Registrant" means a person who holds a valid and unrevoked
garment manufacturer registration.
   (b) (1) The Labor Commissioner shall require an applicant for any
of the following to submit a statement as to whether the applicant
has satisfied all requirements imposed by a final judgment issued by
a court or by a final order issued by the Labor Commissioner or by an
accord involving unpaid wages:
   (A) Licensure as a farm labor contractor.
   (B) Registration as a garment manufacturer.
   (C) Renewal or reinstatement of a farm labor contractor license or
a garment manufacturer registration.
   (D) A change in the persons identified pursuant to Section 1689 or
subparagraph (B) of paragraph (1) of subdivision (a) of Section
2675.
   (2) A person who knowingly provides false information in the
statement submitted pursuant to this subdivision shall be subject to
a civil penalty of no less than one thousand dollars ($1,000) and no
more than twenty-five thousand dollars ($25,000), in addition to any
civil remedies available to the Labor Commissioner. The penalty shall
be recovered by the Labor Commissioner as part of a hearing relating
to a denial of an application for a license or registration, a
hearing relating to a denial of a renewal or reinstatement of a
license or registration,
    a hearing to contest the civil penalties assessed under this
section by the Labor Commissioner, or in an independent civil action.
The action shall be brought in the name of the people of the State
of California and the Labor Commissioner and the attorneys thereof
may proceed and act for and on behalf of the people in bringing these
actions.
   (c) Notwithstanding any other provision of law, the Labor
Commissioner shall not approve an application described in
subdivision (b) if the statement submitted with it shows that the
applicant has failed to satisfy all requirements imposed by a final
judgment issued by a court or by a final order issued by the Labor
Commissioner or by an accord involving unpaid wages, as described in
subdivision (b), unless the applicant submits either of the following
to the Labor Commissioner:
   (1) A bond or a cash deposit, in addition to any required by
Section 240, 1684, 1688, 2675, or 2679, in an amount sufficient to
guarantee payment of all amounts due under a final judgment issued by
a court or under a final order issued by the Labor Commissioner
involving unpaid wages.
   (2) A notarized accord between the applicant and the other parties
to the judgment, order, or accord demonstrating that the applicant
has satisfied all requirements imposed by the judgment, order, or
accord involving unpaid wages.
   (d) Notwithstanding any other provision of law, if the Labor
Commissioner determines after granting an application described in
subdivision (b) that the applicant made a false representation on the
statement he or she submitted, the Labor Commissioner shall suspend
the farm labor contractor license or garment manufacturer
registration effective on the date of its issuance, renewal, or
reinstatement. The license or registration shall remain suspended
until the applicant satisfies either of the following requirements:
   (1) Documents to the satisfaction of the Labor Commissioner that
he or she has satisfied all requirements imposed by a final judgment
issued by a court or by a final order of the Labor Commissioner or by
an accord involving unpaid wages.
   (2) Files with the Labor Commissioner a notarized accord as
described in paragraph (2) of subdivision (c).
   (e) (1) A licensee or registrant shall notify the Labor
Commissioner in writing within 90 days of the date of a final
judgment issued by a court, a final order issued by the Labor
Commissioner, or an accord that imposes on the licensee or registrant
requirements involving unpaid wages. If the licensee or registrant
fails to comply with this notification requirement, the Labor
Commissioner shall suspend the license or registration on the date
that the Labor Commissioner is informed, or is made aware of, the
judgment, order, or accord. The suspension shall remain in effect
until the licensee or registrant satisfies either of the requirements
described in subdivision (d).
   (2) A licensee or registrant who notifies the Labor Commissioner
of a judgment, order, or accord pursuant to paragraph (1), shall file
with the notice a bond or a cash deposit meeting the criteria of
paragraph (1) of subdivision (c).
   (f) (1) The Labor Commissioner may reduce the amount of a bond or
cash deposit required by this section upon proof, to the satisfaction
of the Labor Commissioner, of partial satisfaction of the
requirements imposed by a final judgment issued by a court, a final
order issued by the Labor Commissioner, or an accord involving unpaid
wages. The Labor Commissioner shall not reduce the bond or cash
deposit amount below the balance of the entire amount involving
unpaid wages. Upon full satisfaction of the requirements involving
unpaid wages, the Labor Commissioner may terminate the bond or cash
deposit requirement.
   (2) Notwithstanding paragraph (1), within one year from the date
of filing the bond or cash deposit pursuant to paragraph (1) of
subdivision (c) or paragraph (2) of subdivision (e), a licensee or
registrant shall submit a notarized accord between the licensee or
registrant and the other parties to the judgment, order, or accord
demonstrating satisfaction of all requirements imposed by the
judgment, order, or accord involving unpaid wages. The Labor
Commissioner shall suspend the license or registration of a person
who fails to file the notarized accord within that timeframe.
Notwithstanding paragraph (1) of subdivision (c), a person who has
failed to file a notarized accord within the timeframe required by
this paragraph shall have his or her license or registration
reinstated only after demonstrating that he or she has satisfied all
requirements imposed by a final judgment, order, or accord involving
unpaid wages. As an alternative to payment in full of all debts
involving unpaid wages, a person may submit a notarized copy of an
accord between the licensee or registrant and the other parties to
the accord.
   (g) The failure of a licensee or registrant to maintain a bond
required by this section or to abide by all requirements imposed on a
licensee or registrant by an accord involving unpaid wages between
the licensee or registrant and the other parties to the accord shall
result in the automatic suspension of his or her license or
registration.
   (h) (1) A licensee or registrant shall not allow a person who is a
judgment debtor in a final judgment issued by a court or in a final
order issued by the Labor Commissioner involving unpaid wages that
imposes requirements that have not been satisfied in their entirety
to serve in a capacity described in Section 1689 or subparagraph (B)
of paragraph (1) of subdivision (a) of Section 2675.
   (2) The Labor Commissioner shall suspend the license of a farm
labor contractor or the registration of a garment manufacturer who
violates the provisions of paragraph (1). The Labor Commissioner
shall reinstate the license or registration upon the resignation of
the person named as a judgment debtor or complete satisfaction of the
unpaid wages requirements.
   (i) A person whose license or registration is suspended pursuant
to this section, who is denied issuance or reinstatement of a license
or registration, or who has been assessed a civil penalty for
knowingly providing false information in the statement required by
paragraph (1) of subdivision (b) shall pay to the Labor Commissioner
all reasonable costs incurred by the Labor Commissioner in all
activities relating to the adverse license or registration action,
commencing with the first notice issued by the Labor Commissioner
that he or she has taken any adverse action under this section
relative to a license or registration. The Labor Commissioner shall
not reinstate a license or registration unless the person has paid
all costs assessed by the Labor Commissioner or has entered into an
accord with the Labor Commissioner that establishes a payment plan.
   (j) This section shall not apply to an applicant for a farm labor
contractor license or a garment manufacturer registration or to a
licensee or registrant when the unpaid wages, as described by this
section, have been discharged in a bankruptcy proceeding.
  SEC. 152.  Section 699.5 of the Military and Veterans Code is
amended to read:
   699.5.  (a) The department may assist every veteran of the United
States and the dependent or survivor of every veteran of the United
States in presenting and pursuing the claim as the veteran,
dependent, or survivor may have against the United States arising out
of war service and in establishing the veteran's, dependent's, or
survivor's right to any privilege, preference, care, or compensation
provided for by the laws of the United States or of this state. The
department may cooperate and, with the approval of the Department of
Finance, contract with any veterans service organization, and
pursuant to the contract may compensate the organization for services
within the scope of this section rendered by it to any veteran or
dependent or survivor of a veteran. The contract shall not be made
unless the department determines that, owing to the confidential
relationships involved and the necessity of operating through
agencies that the veterans, dependents, or survivors involved will
feel to be sympathetic toward their problems, the services cannot
satisfactorily be rendered otherwise than through the agency of the
veterans organization and that the best interests of the veterans,
dependents, or survivors involved will be served if the contract is
made.
   (b) (1) The Legislature finds and declares that services provided
by veterans service organizations play an important role in the
department's responsibilities to assist veterans and their dependents
and survivors in presenting and pursuing claims against the United
States, and that it is an efficient and reasonable use of state funds
to provide compensation to veterans service organizations for these
services.
   (2) The Legislature further finds and declares that paragraph (1)
shall not be implemented by using the General Fund until the annual
budget for county veterans service officers reaches a minimum of five
million dollars ($5,000,000). This subdivision shall not be
construed to preclude the use of federal funding in implementing
these provisions.
   (c) Veterans service organizations that elect to contract with the
department in accordance with this section shall document the claims
processed each year by the veterans service officers employed by the
veterans service organization at offices located in California. The
documentation shall be in accordance with procedures established by
the department.
   (d) The department shall determine annually the amount of monetary
benefits paid to eligible veterans and their dependents and
survivors in the state as a result of the work of the veterans
service officers of the contracting organizations. Beginning on
January 1, 2006, the department shall, on or before January 1 of each
year, prepare and transmit its determination for the preceding
fiscal year to the Department of Finance and the Legislature. The
department shall also identify federal sources to support the efforts
of veterans service organizations pursuant to this section. The
Department of Finance shall review the department's determination in
time to use the information in the annual Budget Act for the budget
of the department for the next fiscal year.
   (e) For purposes of this section:
   (1) "Survivor" means any relation of a deceased veteran who may be
entitled to make a claim for any privilege, preference, care, or
compensation under the laws of the United States or this state based
upon the veteran's war service.
   (2) "Veterans service officer" means an individual employed by a
veterans service organization and accredited by the United States
Department of Veterans Affairs to process and adjudicate claims and
other benefits for veterans and their dependents and survivors.
   (3) "Veterans service organization" means an organization that
meets all of the following criteria:
   (A) Is formed by and for United States military veterans.
   (B) Is chartered by the United States Congress.
   (C) Has regularly maintained an established committee or agency in
a regional office of the United States Department of Veterans
Affairs in California rendering services to veterans and their
dependents and survivors.
  SEC. 153.  Section 290.011 of the Penal Code is amended to read:
   290.011.  Every person who is required to register pursuant to the
act who is living as a transient shall be required to register for
the rest of his or her life as follows:
   (a) He or she shall register, or reregister if the person has
previously registered, within five working days from release from
incarceration, placement or commitment, or release on probation,
pursuant to subdivision (b) of Section 290, except that if the person
previously registered as a transient less than 30 days from the date
of his or her release from incarceration, he or she does not need to
reregister as a transient until his or her next required 30-day
update of registration. If a transient convicted in another
jurisdiction enters the state, he or she shall register within five
working days of coming into California with the chief of police of
the city in which he or she is present or the sheriff of the county
if he or she is present in an unincorporated area or city that has no
police department. If a transient is not physically present in any
one jurisdiction for five consecutive working days, he or she shall
register in the jurisdiction in which he or she is physically present
on the fifth working day following release, pursuant to subdivision
(b) of Section 290. Beginning on or before the 30th day following
initial registration upon release, a transient shall reregister no
less than once every 30 days thereafter. A transient shall register
with the chief of police of the city in which he or she is physically
present within that 30-day period, or the sheriff of the county if
he or she is physically present in an unincorporated area or city
that has no police department, and additionally, with the chief of
police of a campus of the University of California, the California
State University, or community college if he or she is physically
present upon the campus or in any of its facilities. A transient
shall reregister no less than once every 30 days regardless of the
length of time he or she has been physically present in the
particular jurisdiction in which he or she reregisters. If a
transient fails to reregister within any 30-day period, he or she may
be prosecuted in any jurisdiction in which he or she is physically
present.
   (b) A transient who moves to a residence shall have five working
days within which to register at that address, in accordance with
subdivision (b) of Section 290. A person registered at a residence
address in accordance with that provision who becomes transient shall
have five working days within which to reregister as a transient in
accordance with subdivision (a).
   (c) Beginning on his or her first birthday following registration,
a transient shall register annually, within five working days of his
or her birthday, to update his or her registration with the entities
described in subdivision (a). A transient shall register in
whichever jurisdiction he or she is physically present on that date.
At the 30-day updates and the annual update, a transient shall
provide current information as required on the Department of Justice
annual update form, including the information described in paragraphs
(1) to (3), inclusive, of subdivision (a) of Section 290.015, and
the information specified in subdivision (d).
   (d) A transient shall, upon registration and reregistration,
provide current information as required on the Department of Justice
registration forms, and shall also list the places where he or she
sleeps, eats, works, frequents, and engages in leisure activities. If
a transient changes or adds to the places listed on the form during
the 30-day period, he or she does not need to report the new place or
places until the next required reregistration.
   (e) Failure to comply with the requirement of reregistering every
30 days following initial registration pursuant to subdivision (a)
shall be punished in accordance with subdivision (g) of Section
290.018. Failure to comply with any other requirement of this section
shall be punished in accordance with either subdivision (a) or (b)
of Section 290.018.
   (f) A transient who moves out of state shall inform, in person,
the chief of police in the city in which he or she is physically
present, or the sheriff of the county if he or she is physically
present in an unincorporated area or city that has no police
department, within five working days, of his or her move out of
state. The transient shall inform that registering agency of his or
her planned destination, residence or transient location out of
state, and any plans he or she has to return to California, if known.
The law enforcement agency shall, within three days after receipt of
this information, forward a copy of the change of location
information to the Department of Justice. The department shall
forward appropriate registration data to the law enforcement agency
having local jurisdiction of the new place of residence or location.
   (g) For purposes of the act, "transient" means a person who has no
residence. "Residence" means one or more addresses at which a person
regularly resides, regardless of the number of days or nights spent
there, such as a shelter or structure that can be located by a street
address, including, but not limited to, houses, apartment buildings,
motels, hotels, homeless shelters, and recreational and other
vehicles.
   (h) The transient registrant's duty to update his or her
registration no less than every 30 days shall begin with his or her
second transient update following the date this section became
effective.
  SEC. 154.  Section 293 of the Penal Code is amended to read:
   293.  (a) An employee of a law enforcement agency who personally
receives a report from a person, alleging that the person making the
report has been the victim of a sex offense, or was forced to commit
an act of prostitution because he or she is the victim of human
trafficking, as defined in Section 236.1, shall inform that person
that his or her name will become a matter of public record unless he
or she requests that it not become a matter of public record,
pursuant to Section 6254 of the Government Code.
   (b) A written report of an alleged sex offense shall indicate that
the alleged victim has been properly informed pursuant to
subdivision (a) and shall memorialize his or her response.
   (c) A law enforcement agency shall not disclose to a person,
except the prosecutor, parole officers of the Department of
Corrections and Rehabilitation, hearing officers of the parole
authority, probation officers of county probation departments, or
other persons or public agencies where authorized or required by law,
the address of a person who alleges to be the victim of a sex
offense or who was forced to commit an act of prostitution because he
or she is the victim of human trafficking, as defined in Section
236.1.
   (d) A law enforcement agency shall not disclose to a person,
except the prosecutor, parole officers of the Department of
Corrections and Rehabilitation, hearing officers of the parole
authority, probation officers of county probation departments, or
other persons or public agencies where authorized or required by law,
the name of a person who alleges to be the victim of a sex offense
or who was forced to commit an act of prostitution because he or she
is the victim of human trafficking, as defined in Section 236.1, if
that person has elected to exercise his or her right pursuant to this
section and Section 6254 of the Government Code.
   (e) For purposes of this section, sex offense means any crime
listed in paragraph (2) of subdivision (f) of Section 6254 of the
Government Code.
   (f) Parole officers of the Department of Corrections and
Rehabilitation, hearing officers of the parole authority, and
probation officers of county probation departments shall be entitled
to receive information pursuant to subdivisions (c) and (d) only if
the person to whom the information pertains alleges that he or she is
the victim of a sex offense or was forced to commit an act of
prostitution because he or she is the victim of human trafficking, as
defined in Section 236.1, the alleged perpetrator of which is a
parolee who is alleged to have committed the offense while on parole,
or in the case of a county probation officer, the person who is
alleged to have committed the offense is a probationer or is under
investigation by a county probation department.
  SEC. 155.  Section 336.9 of the Penal Code is amended to read:
   336.9.  (a) Notwithstanding Section 337a, and except as provided
in subdivision (b), any person who, not for gain, hire, or reward
other than that at stake under conditions available to every
participant, knowingly participates in any of the ways specified in
paragraph (2), (3), (4), (5), or (6) of subdivision (a) of Section
337a in any bet, bets, wager, wagers, or betting pool or pools made
between the person and any other person or group of persons who are
not acting for gain, hire, or reward, other than that at stake under
conditions available to every participant, upon the result of any
lawful trial, or purported trial, or contest, or purported contest,
of skill, speed, or power of endurance of person or animal, or
between persons, animals, or mechanical apparatus, is guilty of an
infraction, punishable by a fine not to exceed two hundred fifty
dollars ($250).
   (b) Subdivision (a) does not apply to either of the following
situations:
   (1) Any bet, bets, wager, wagers, or betting pool or pools made
online.
   (2) Betting pools with more than two thousand five hundred dollars
($2,500) at stake.
  SEC. 156.  Section 597.5 of the Penal Code is amended to read:
   597.5.  (a) Any person who does any of the following is guilty of
a felony and is punishable by imprisonment in the state prison for 16
months, or two or three years, or by a fine not to exceed fifty
thousand dollars ($50,000), or by both that fine and imprisonment:
   (1) Owns, possesses, keeps, or trains any dog, with the intent
that the dog shall be engaged in an exhibition of fighting with
another dog.
   (2) For amusement or gain, causes any dog to fight with another
dog, or causes any dogs to injure each other.
   (3) Permits any act in violation of paragraph (1) or (2) to be
done on any premises under his or her charge or control, or aids or
abets that act.
   (b) Any person who is knowingly present, as a spectator, at any
place, building, or tenement where preparations are being made for an
exhibition of the fighting of dogs, with the intent to be present at
those preparations, or is knowingly present at that exhibition or at
any other fighting or injuring as described in paragraph (2) of
subdivision (a), with the intent to be present at that exhibition,
fighting, or injuring, is guilty of an offense punishable by
imprisonment in a county jail not to exceed one year, or by a fine
not to exceed five thousand dollars ($5,000), or by both that
imprisonment and fine.
   (c) Nothing in this section shall prohibit any of the following:
   (1) The use of dogs in the management of livestock, as defined by
Section 14205 of the Food and Agricultural Code, by the owner of the
livestock or his or her employees or agents or other persons in
lawful custody thereof.
   (2) The use of dogs in hunting as permitted by the Fish and Game
Code, including, but not limited to, Sections 4002 and 4756, and by
the rules and regulations of the Fish and Game Commission.
   (3) The training of dogs or the use of equipment in the training
of dogs for any purpose not prohibited by law.
  SEC. 157.  Section 626.10 of the Penal Code is amended to read:
   626.10.  (a) (1) Any person, except a duly appointed peace officer
as defined in Chapter 4.5 (commencing with Section 830) of Title 3
of Part 2, a full-time paid peace officer of another state or the
federal government who is carrying out official duties while in this
state, a person summoned by any officer to assist in making arrests
or preserving the peace while the person is actually engaged in
assisting any officer, or a member of the military forces of this
state or the United States who is engaged in the performance of his
or her duties, who brings or possesses any dirk, dagger, ice pick,
knife having a blade longer than 21/2 inches, folding knife with a
blade that locks into place, razor with an unguarded blade, taser, or
stun gun, as defined in subdivision (a) of Section 244.5, any
instrument that expels a metallic projectile, such as a BB or a
pellet, through the force of air pressure, CO2 pressure, or spring
action, or any spot marker gun, upon the grounds of, or within, any
public or private school providing instruction in kindergarten or any
of grades 1 to 12, inclusive, is guilty of a public offense,
punishable by imprisonment in a county jail not exceeding one year,
or by imprisonment in the state prison.
   (2) Any person, except a duly appointed peace officer as defined
in Chapter 4.5 (commencing with Section 830) of Title 3 of Part 2, a
full-time paid peace officer of another state or the federal
government who is carrying out official duties while in this state, a
person summoned by any officer to assist in making arrests or
preserving the peace while the person is actually engaged in
assisting any officer, or a member of the military forces of this
state or the United States who is engaged in the performance of his
or her duties, who brings or possesses a razor blade or a box cutter
upon the grounds of, or within, any public or private school
providing instruction in kindergarten or any of grades 1 to 12,
inclusive, is guilty of a public offense, punishable by imprisonment
in a county jail not exceeding one year.
   (b) Any person, except a duly appointed peace officer as defined
in Chapter 4.5 (commencing with Section 830) of Title 3 of Part 2, a
full-time paid peace officer of another state or the federal
government who is carrying out official duties while in this state, a
person summoned by any officer to assist in making arrests or
preserving the peace while the person is actually engaged in
assisting any officer, or a member of the military forces of this
state or the United States who is engaged in the performance of his
or her duties, who brings or possesses any dirk, dagger, ice pick, or
knife having a fixed blade longer than 21/2 inches upon the grounds
of, or within, any private university, the University of California,
the California State University, or the California Community Colleges
is guilty of a public offense, punishable by imprisonment in a
county jail not exceeding one year, or by imprisonment in the state
prison.
   (c) Subdivisions (a) and (b) do not apply to any person who brings
or possesses a knife having a blade longer than 21/2 inches, a razor
with an unguarded blade, a razor blade, or a box cutter upon the
grounds of, or within, a public or private school providing
instruction in kindergarten or any of grades 1 to 12, inclusive, or
any private university, state university, or community college at the
direction of a faculty member of the private university, state
university, or community college, or a certificated or classified
employee of the school for use in a private university, state
university, community college, or school-sponsored activity or class.

   (d) Subdivisions (a) and (b) do not apply to any person who brings
or possesses an ice pick, a knife having a blade longer than 21/2
inches, a razor with an unguarded blade, a razor blade,
                             or a box cutter upon the grounds of, or
within, a public or private school providing instruction in
kindergarten or any of grades 1 to 12, inclusive, or any private
university, state university, or community college for a lawful
purpose within the scope of the person's employment.
   (e) Subdivision (b) does not apply to any person who brings or
possesses an ice pick or a knife having a fixed blade longer than
21/2 inches upon the grounds of, or within, any private university,
state university, or community college for lawful use in or around a
residence or residential facility located upon those grounds or for
lawful use in food preparation or consumption.
   (f) Subdivision (a) does not apply to any person who brings an
instrument that expels a metallic projectile, such as a BB or a
pellet, through the force of air pressure, CO2 pressure, or spring
action, or any spot marker gun, or any razor blade or box cutter upon
the grounds of, or within, a public or private school providing
instruction in kindergarten or any of grades 1 to 12, inclusive, if
the person has the written permission of the school principal or his
or her designee.
   (g) Any certificated or classified employee or school peace
officer of a public or private school providing instruction in
kindergarten or any of grades 1 to 12, inclusive, may seize any of
the weapons described in subdivision (a), and any certificated or
classified employee or school peace officer of any private
university, state university, or community college may seize any of
the weapons described in subdivision (b), from the possession of any
person upon the grounds of, or within, the school if he or she knows,
or has reasonable cause to know, the person is prohibited from
bringing or possessing the weapon upon the grounds of, or within, the
school.
   (h) As used in this section, "dirk" or "dagger" means a knife or
other instrument with or without a handguard that is capable of ready
use as a stabbing weapon that may inflict great bodily injury or
death.
   (i) Any person who, without the written permission of the college
or university president or chancellor or his or her designee, brings
or possesses a less lethal weapon, as defined in Section 12601, or a
stun gun, as defined in Section 12650, upon the grounds of, or
within, a public or private college or university campus is guilty of
a misdemeanor.
  SEC. 158.  Section 831.5 of the Penal Code is amended to read:
   831.5.  (a) As used in this section, a custodial officer is a
public officer, not a peace officer, employed by a law enforcement
agency of Fresno County, Kern County, Riverside County, San Diego
County, Santa Clara County, Stanislaus County, or a county having a
population of 425,000 or less who has the authority and
responsibility for maintaining custody of prisoners and performs
tasks related to the operation of a local detention facility used for
the detention of persons usually pending arraignment or upon court
order either for their own safekeeping or for the specific purpose of
serving a sentence therein. Custodial officers of a county shall be
employees of, and under the authority of, the sheriff, except in
counties in which the sheriff, as of July 1, 1993, is not in charge
of and the sole and exclusive authority to keep the county jail and
the prisoners in it. A custodial officer includes a person designated
as a correctional officer, jailer, or other similar title. The
duties of a custodial officer may include the serving of warrants,
court orders, writs, and subpoenas in the detention facility or under
circumstances arising directly out of maintaining custody of
prisoners and related tasks.
   (b) A custodial officer has no right to carry or possess firearms
in the performance of his or her prescribed duties, except, under the
direction of the sheriff or chief of police, while engaged in
transporting prisoners; guarding hospitalized prisoners; or
suppressing jail riots, lynchings, escapes, or rescues in or about a
detention facility falling under the care and custody of the sheriff
or chief of police.
   (c) Each person described in this section as a custodial officer
shall, within 90 days following the date of the initial assignment to
that position, satisfactorily complete the training course specified
in Section 832. In addition, each person designated as a custodial
officer shall, within one year following the date of the initial
assignment as a custodial officer, have satisfactorily met the
minimum selection and training standards prescribed by the
Corrections Standards Authority pursuant to Section 6035. Persons
designated as custodial officers, before the expiration of the 90-day
and one-year periods described in this subdivision, who have not yet
completed the required training, shall not carry or possess firearms
in the performance of their prescribed duties, but may perform the
duties of a custodial officer only while under the direct supervision
of a peace officer, as described in Section 830.1, who has completed
the training prescribed by the Commission on Peace Officer Standards
and Training, or a custodial officer who has completed the training
required in this section.
   (d) At any time 20 or more custodial officers are on duty, there
shall be at least one peace officer, as described in Section 830.1,
on duty at the same time to supervise the performance of the
custodial officers.
   (e) This section shall not be construed to confer any authority
upon any custodial officer except while on duty.
   (f) A custodial officer may use reasonable force in establishing
and maintaining custody of persons delivered to him or her by a law
enforcement officer; may make arrests for misdemeanors and felonies
within the local detention facility pursuant to a duly issued
warrant; may make warrantless arrests pursuant to Section 836.5 only
during the duration of his or her job; may release without further
criminal process persons arrested for intoxication; and may release
misdemeanants on citation to appear in lieu of or after booking.
   (g) Custodial officers employed by the Santa Clara County
Department of Corrections are authorized to perform the following
additional duties in the facility:
   (1) Arrest a person without a warrant whenever the custodial
officer has reasonable cause to believe that the person to be
arrested has committed a misdemeanor or felony in the presence of the
officer that is a violation of a statute or ordinance that the
officer has the duty to enforce.
   (2) Search property, cells, prisoners, or visitors.
   (3) Conduct strip or body cavity searches of prisoners pursuant to
Section 4030.
   (4) Conduct searches and seizures pursuant to a duly issued
warrant.
   (5) Segregate prisoners.
   (6) Classify prisoners for the purpose of housing or participation
in supervised activities.
   These duties may be performed at the Santa Clara Valley Medical
Center as needed and only as they directly relate to guarding
inpatient, in-custody inmates. This subdivision shall not be
construed to authorize the performance of any law enforcement
activity involving any person other than the inmate or his or her
visitors.
   (h) Nothing in this section shall authorize a custodial officer to
carry or possess a firearm when the officer is not on duty.
   (i) It is the intent of the Legislature that this section, as it
relates to Santa Clara County, enumerate specific duties of custodial
officers (known as "correctional officers" in Santa Clara County)
and to clarify the relationships of the correctional officers and
deputy sheriffs in Santa Clara County. These duties are the same
duties of the custodial officers prior to the date of enactment of
Chapter 635 of the Statutes of 1999 pursuant to local rules and
judicial decisions. It is further the intent of the Legislature that
all issues regarding compensation for custodial officers remain
subject to the collective bargaining process between the County of
Santa Clara and the authorized bargaining representative for the
custodial officers. However, nothing in this section shall be
construed to assert that the duties of custodial officers are
equivalent to the duties of deputy sheriffs nor to affect the ability
of the county to negotiate pay that reflects the different duties of
custodial officers and deputy sheriffs.
   (j) This section shall become operative on January 1, 2003.
  SEC. 159.  Section 851.8 of the Penal Code is amended to read:
   851.8.  (a) In any case where a person has been arrested and no
accusatory pleading has been filed, the person arrested may petition
the law enforcement agency having jurisdiction over the offense to
destroy its records of the arrest. A copy of the petition shall be
served upon the prosecuting attorney of the county or city having
jurisdiction over the offense. The law enforcement agency having
jurisdiction over the offense, upon a determination that the person
arrested is factually innocent, shall, with the concurrence of the
prosecuting attorney, seal its arrest records, and the petition for
relief under this section for three years from the date of the arrest
and thereafter destroy its arrest records and the petition. The law
enforcement agency having jurisdiction over the offense shall notify
the Department of Justice, and any law enforcement agency that
arrested the petitioner or participated in the arrest of the
petitioner for an offense for which the petitioner has been found
factually innocent under this subdivision, of the sealing of the
arrest records and the reason therefor. The Department of Justice and
any law enforcement agency so notified shall forthwith seal their
records of the arrest and the notice of sealing for three years from
the date of the arrest, and thereafter destroy their records of the
arrest and the notice of sealing. The law enforcement agency having
jurisdiction over the offense and the Department of Justice shall
request the destruction of any records of the arrest which they have
given to any local, state, or federal agency or to any other person
or entity. Each agency, person, or entity within the State of
California receiving the request shall destroy its records of the
arrest and the request, unless otherwise provided in this section.
   (b) If, after receipt by both the law enforcement agency and the
prosecuting attorney of a petition for relief under subdivision (a),
the law enforcement agency and prosecuting attorney do not respond to
the petition by accepting or denying the petition within 60 days
after the running of the relevant statute of limitations or within 60
days after receipt of the petition in cases where the statute of
limitations has previously lapsed, then the petition shall be deemed
to be denied. In any case where the petition of an arrestee to the
law enforcement agency to have an arrest record destroyed is denied,
petition may be made to the superior court that would have had
territorial jurisdiction over the matter. A copy of the petition
shall be served on the law enforcement agency and the prosecuting
attorney of the county or city having jurisdiction over the offense
at least 10 days prior to the hearing thereon. The prosecuting
attorney and the law enforcement agency through the district attorney
may present evidence to the court at the hearing. Notwithstanding
Section 1538.5 or 1539, any judicial determination of factual
innocence made pursuant to this section may be heard and determined
upon declarations, affidavits, police reports, or any other evidence
submitted by the parties which is material, relevant, and reliable. A
finding of factual innocence and an order for the sealing and
destruction of records pursuant to this section shall not be made
unless the court finds that no reasonable cause exists to believe
that the arrestee committed the offense for which the arrest was
made. In any court hearing to determine the factual innocence of a
party, the initial burden of proof shall rest with the petitioner to
show that no reasonable cause exists to believe that the arrestee
committed the offense for which the arrest was made. If the court
finds that this showing of no reasonable cause has been made by the
petitioner, then the burden of proof shall shift to the respondent to
show that a reasonable cause exists to believe that the petitioner
committed the offense for which the arrest was made. If the court
finds the arrestee to be factually innocent of the charges for which
the arrest was made, then the court shall order the law enforcement
agency having jurisdiction over the offense, the Department of
Justice, and any law enforcement agency which arrested the petitioner
or participated in the arrest of the petitioner for an offense for
which the petitioner has been found factually innocent under this
section to seal their records of the arrest and the court order to
seal and destroy the records, for three years from the date of the
arrest and thereafter to destroy their records of the arrest and the
court order to seal and destroy those records. The court shall also
order the law enforcement agency having jurisdiction over the offense
and the Department of Justice to request the destruction of any
records of the arrest which they have given to any local, state, or
federal agency, person or entity. Each state or local agency, person
or entity within the State of California receiving such a request
shall destroy its records of the arrest and the request to destroy
the records, unless otherwise provided in this section. The court
shall give to the petitioner a copy of any court order concerning the
destruction of the arrest records.
   (c) In any case where a person has been arrested, and an
accusatory pleading has been filed, but where no conviction has
occurred, the defendant may, at any time after dismissal of the
action, petition the court that dismissed the action for a finding
that the defendant is factually innocent of the charges for which the
arrest was made. A copy of the petition shall be served on the
prosecuting attorney of the county or city in which the accusatory
pleading was filed at least 10 days prior to the hearing on the
petitioner's factual innocence. The prosecuting attorney may present
evidence to the court at the hearing. The hearing shall be conducted
as provided in subdivision (b). If the court finds the petitioner to
be factually innocent of the charges for which the arrest was made,
then the court shall grant the relief as provided in subdivision (b).

   (d) In any case where a person has been arrested and an accusatory
pleading has been filed, but where no conviction has occurred, the
court may, with the concurrence of the prosecuting attorney, grant
the relief provided in subdivision (b) at the time of the dismissal
of the accusatory pleading.
   (e) Whenever any person is acquitted of a charge and it appears to
the judge presiding at the trial at which the acquittal occurred
that the defendant was factually innocent of the charge, the judge
may grant the relief provided in subdivision (b).
   (f) In any case where a person who has been arrested is granted
relief pursuant to subdivision (a) or (b), the law enforcement agency
having jurisdiction over the offense or court shall issue a written
declaration to the arrestee stating that it is the determination of
the law enforcement agency having jurisdiction over the offense or
court that the arrestee is factually innocent of the charges for
which the person was arrested and that the arrestee is thereby
exonerated. Thereafter, the arrest shall be deemed not to have
occurred and the person may answer accordingly any question relating
to its occurrence.
   (g) The Department of Justice shall furnish forms to be utilized
by persons applying for the destruction of their arrest records and
for the written declaration that one person was found factually
innocent under subdivisions (a) and (b).
   (h) Documentation of arrest records destroyed pursuant to
subdivision (a), (b), (c), (d), or (e) that are contained in
investigative police reports shall bear the notation "Exonerated"
whenever reference is made to the arrestee. The arrestee shall be
notified in writing by the law enforcement agency having jurisdiction
over the offense of the sealing and destruction of the arrest
records pursuant to this section.
   (i) (1) Any finding that an arrestee is factually innocent
pursuant to subdivision (a), (b), (c), (d), or (e) shall not be
admissible as evidence in any action.
   (2) Notwithstanding paragraph (1), a finding that an arrestee is
factually innocent pursuant to subdivisions (a) to (e), inclusive,
shall be admissible as evidence at a hearing before the California
Victim Compensation and Government Claims Board.
   (j) Destruction of records of arrest pursuant to subdivision (a),
(b), (c), (d), or (e) shall be accomplished by permanent obliteration
of all entries or notations upon the records pertaining to the
arrest, and the record shall be prepared again so that it appears
that the arrest never occurred. However, where (1) the only entries
on the record pertain to the arrest and (2) the record can be
destroyed without necessarily affecting the destruction of other
records, then the document constituting the record shall be
physically destroyed.
   (k) No records shall be destroyed pursuant to subdivision (a),
(b), (c), (d), or (e) if the arrestee or a codefendant has filed a
civil action against the peace officers or law enforcement
jurisdiction which made the arrest or instituted the prosecution and
if the agency which is the custodian of the records has received a
certified copy of the complaint in the civil action, until the civil
action has been resolved. Any records sealed pursuant to this section
by the court in the civil actions, upon a showing of good cause, may
be opened and submitted into evidence. The records shall be
confidential and shall be available for inspection only by the court,
jury, parties, counsel for the parties, and any other person
authorized by the court. Immediately following the final resolution
of the civil action, records subject to subdivision (a), (b), (c),
(d), or (e) shall be sealed and destroyed pursuant to subdivision
(a), (b), (c), (d), or (e).
   (l) For arrests occurring on or after January 1, 1981, and for
accusatory pleadings filed on or after January 1, 1981, petitions for
relief under this section may be filed up to two years from the date
of the arrest or filing of the accusatory pleading, whichever is
later. Until January 1, 1983, petitioners can file for relief under
this section for arrests which occurred or accusatory pleadings which
were filed up to five years prior to the effective date of the
statute. Any time restrictions on filing for relief under this
section may be waived upon a showing of good cause by the petitioner
and in the absence of prejudice.
   (m) Any relief which is available to a petitioner under this
section for an arrest shall also be available for an arrest which has
been deemed to be or described as a detention under Section 849.5 or
851.6.
   (n) This section shall not apply to any offense which is
classified as an infraction.
   (o) (1) This section shall be repealed on the effective date of a
final judgment based on a claim under the California or United States
Constitution holding that evidence that is relevant, reliable, and
material may not be considered for purposes of a judicial
determination of factual innocence under this section. For purposes
of this subdivision, a judgment by the appellate division of a
superior court is a final judgment if it is published and if it is
not reviewed on appeal by a court of appeal. A judgment of a court of
appeal is a final judgment if it is published and if it is not
reviewed by the California Supreme Court.
   (2) Any decision referred to in this subdivision shall be stayed
pending appeal.
   (3) If not otherwise appealed by a party to the action, any
decision referred to in this subdivision which is a judgment by the
appellate division of the superior court shall be appealed by the
Attorney General.
   (p) A judgment of the court under subdivision (b), (c), (d), or
(e) is subject to the following appeal path:
   (1) In a felony case, appeal is to the court of appeal.
   (2) In a misdemeanor case, or in a case in which no accusatory
pleading was filed, appeal is to the appellate division of the
superior court.
  SEC. 160.  Section 1000.1 of the Penal Code is amended to read:
   1000.1.  (a) If the prosecuting attorney determines that this
chapter may be applicable to the defendant, he or she shall advise
the defendant and his or her attorney in writing of that
determination. This notification shall include all of the following:
   (1) A full description of the procedures for deferred entry of
judgment.
   (2) A general explanation of the roles and authorities of the
probation department, the prosecuting attorney, the program, and the
court in the process.
   (3) A clear statement that in lieu of trial, the court may grant
deferred entry of judgment with respect to any crime specified in
subdivision (a) of Section 1000 that is charged, provided that the
defendant pleads guilty to each of these charges and waives time for
the pronouncement of judgment, and that upon the defendant's
successful completion of a program, as specified in subdivision (c)
of Section 1000, the positive recommendation of the program authority
and the motion of the prosecuting attorney, the court, or the
probation department, but no sooner than 18 months and no later than
three years from the date of the defendant's referral to the program,
the court shall dismiss the charge or charges against the defendant.

   (4) A clear statement that upon any failure of treatment or
condition under the program, or any circumstance specified in Section
1000.3, the prosecuting attorney or the probation department or the
court on its own may make a motion to the court for entry of judgment
and the court shall render a finding of guilt to the charge or
charges pled, enter judgment, and schedule a sentencing hearing as
otherwise provided in this code.
   (5) An explanation of criminal record retention and disposition
resulting from participation in the deferred entry of judgment
program and the defendant's rights relative to answering questions
about his or her arrest and deferred entry of judgment following
successful completion of the program.
   (b) If the defendant consents and waives his or her right to a
speedy trial or a speedy preliminary hearing, the court may refer the
case to the probation department or the court may summarily grant
deferred entry of judgment if the defendant pleads guilty to the
charge or charges and waives time for the pronouncement of judgment.
When directed by the court, the probation department shall make an
investigation and take into consideration the defendant's age,
employment and service records, educational background, community and
family ties, prior controlled substance use, treatment history, if
any, demonstrable motivation, and other mitigating factors in
determining whether the defendant is a person who would be benefited
by education, treatment, or rehabilitation. The probation department
shall also determine which programs the defendant would benefit from
and which programs would accept the defendant. The probation
department shall report its findings and recommendations to the
court. The court shall make the final determination regarding
education, treatment, or rehabilitation for the defendant. If the
court determines that it is appropriate, the court shall grant
deferred entry of judgment if the defendant pleads guilty to the
charge or charges and waives time for the pronouncement of judgment.
   (c) No statement, or any information procured therefrom, made by
the defendant to any probation officer or drug treatment worker, that
is made during the course of any investigation conducted by the
probation department or treatment program pursuant to subdivision
(b), and prior to the reporting of the probation department's
findings and recommendations to the court, shall be admissible in any
action or proceeding brought subsequent to the investigation.
   No statement, or any information procured therefrom, with respect
to the specific offense with which the defendant is charged, that is
made to any probation officer or drug program worker subsequent to
the granting of deferred entry of judgment, shall be admissible in
any action or proceeding, including a sentencing hearing.
   (d) A defendant's plea of guilty pursuant to this chapter shall
not constitute a conviction for any purpose unless a judgment of
guilty is entered pursuant to Section 1000.3.
  SEC. 161.  Section 1120 of the Penal Code is amended to read:
   1120.  If a juror has any personal knowledge respecting a fact in
controversy in a cause, he or she must declare the same in open court
during the trial. If, during the retirement of the jury, a juror
declares a fact that could be evidence in the cause, as of his or her
own knowledge, the jury must return into court. In either of these
cases, the juror making the statement must be sworn as a witness and
examined in the presence of the parties in order that the court may
determine whether good cause exists for his or her discharge as a
juror.
  SEC. 162.  Section 1170 of the Penal Code, as amended by Section 2
of Chapter 416 of the Statutes of 2008, is amended to read:
   1170.  (a) (1) The Legislature finds and declares that the purpose
of imprisonment for crime is punishment. This purpose is best served
by terms proportionate to the seriousness of the offense with
provision for uniformity in the sentences of offenders committing the
same offense under similar circumstances. The Legislature further
finds and declares that the elimination of disparity and the
provision of uniformity of sentences can best be achieved by
determinate sentences fixed by statute in proportion to the
seriousness of the offense as determined by the Legislature to be
imposed by the court with specified discretion.
   (2) Notwithstanding paragraph (1), the Legislature further finds
and declares that programs should be available for inmates,
including, but not limited to, educational programs, that are
designed to prepare nonviolent felony offenders for successful
reentry into the community. The Legislature encourages the
development of policies and programs designed to educate and
rehabilitate nonviolent felony offenders. In implementing this
section, the Department of Corrections and Rehabilitation is
encouraged to give priority enrollment in programs to promote
successful return to the community to an inmate with a short
remaining term of commitment and a release date that would allow him
or her adequate time to complete the program.

          (3) In a case in which the punishment prescribed by statute
for a person convicted of a public offense is a term of imprisonment
in the state prison of any specification of three time periods, the
court shall sentence the defendant to one of the terms of
imprisonment specified unless the convicted person is given another
disposition provided by law, including a fine, jail, probation, or
the suspension of imposition or execution of sentence or is sentenced
pursuant to subdivision (b) of Section 1168 because he or she had
committed his or her crime prior to July 1, 1977. In sentencing the
convicted person, the court shall apply the sentencing rules of the
Judicial Council. The court, unless it determines that there are
circumstances in mitigation of the punishment prescribed, shall also
impose any other term that it is required by law to impose as an
additional term. This article does not affect any provision of law
that imposes the death penalty, that authorizes or restricts the
granting of probation or suspending the execution or imposition of
sentence, or expressly provides for imprisonment in the state prison
for life. In a case in which the amount of preimprisonment credit
under Section 2900.5 or another provision of law is equal to or
exceeds any sentence imposed pursuant to this chapter, the entire
sentence shall be deemed to have been served and the defendant shall
not be actually delivered to the custody of the secretary. The court
shall advise the defendant that he or she shall serve a period of
parole and order the defendant to report to the parole office closest
to the defendant's last legal residence, unless the in-custody
credits equal the total sentence, including both confinement time and
the period of parole. The sentence shall be deemed a separate prior
prison term under Section 667.5, and a copy of the judgment and other
necessary documentation shall be forwarded to the secretary.
   (b) When a judgment of imprisonment is to be imposed and the
statute specifies three possible terms, the court shall order
imposition of the middle term, unless there are circumstances in
aggravation or mitigation of the crime. At least four days prior to
the time set for imposition of judgment, either party or the victim,
or the family of the victim if the victim is deceased, may submit a
statement in aggravation or mitigation to dispute facts in the record
or the probation officer's report, or to present additional facts.
In determining whether there are circumstances that justify
imposition of the upper or lower term, the court may consider the
record in the case, the probation officer's report, other reports
including reports received pursuant to Section 1203.03 and statements
in aggravation or mitigation submitted by the prosecution, the
defendant, or the victim, or the family of the victim if the victim
is deceased, and any further evidence introduced at the sentencing
hearing. The court shall set forth on the record the facts and
reasons for imposing the upper or lower term. The court shall not
impose an upper term by using the fact of an enhancement upon which
sentence is imposed under any provision of law. A term of
imprisonment shall not be specified if imposition of sentence is
suspended.
   (c) The court shall state the reasons for its sentence choice on
the record at the time of sentencing. The court also shall inform the
defendant that as part of the sentence after expiration of the term
he or she may be on parole for a period as provided in Section 3000.
   (d) When a defendant subject to this section or subdivision (b) of
Section 1168 has been sentenced to be imprisoned in the state prison
and has been committed to the custody of the secretary, the court
may, within 120 days of the date of commitment on its own motion, or
at any time upon the recommendation of the secretary or the Board of
Parole Hearings, recall the sentence and commitment previously
ordered and resentence the defendant in the same manner as if he or
she had not previously been sentenced, provided that the new
sentence, if any, is no greater than the initial sentence. The
resentence under this subdivision shall apply the sentencing rules of
the Judicial Council to eliminate disparity of sentences and to
promote uniformity of sentencing. Credit shall be given for time
served.
   (e) (1) Notwithstanding any other law and consistent with
paragraph (1) of subdivision (a), if the secretary or the Board of
Parole Hearings or both determine that a prisoner satisfies the
criteria set forth in paragraph (2), the secretary or the board may
recommend to the court that the prisoner's sentence be recalled.
   (2) The court shall have the discretion to resentence or recall if
the court finds that the facts described in subparagraphs (A) and
(B) or subparagraphs (B) and (C) exist:
   (A) The prisoner is terminally ill with an incurable condition
caused by an illness or disease that would produce death within six
months, as determined by a physician employed by the department.
   (B) The conditions under which the prisoner would be released or
receive treatment do not pose a threat to public safety.
   (C) The prisoner is permanently medically incapacitated with a
medical condition that renders him or her permanently unable to
perform activities of basic daily living, and results in the prisoner
requiring 24-hour total care, including, but not limited to, coma,
persistent vegetative state, brain death, ventilator-dependency, or
loss of control of muscular or neurological function, and that
incapacitation did not exist at the time of the original sentencing.
   The Board of Parole Hearings shall make findings pursuant to this
subdivision before making a recommendation for resentence or recall
to the court. This subdivision does not apply to a prisoner sentenced
to death or a term of life without the possibility of parole.
   (3) Within 10 days of receipt of a positive recommendation by the
secretary or the board, the court shall hold a hearing to consider
whether the prisoner's sentence should be recalled.
   (4) A physician employed by the department who determines that a
prisoner has six months or less to live shall notify the chief
medical officer of the prognosis. If the chief medical officer
concurs with the prognosis, he or she shall notify the warden. Within
48 hours of receiving notification, the warden or the warden's
representative shall notify the prisoner of the recall and
resentencing procedures, and shall arrange for the prisoner to
designate a family member or other outside agent to be notified as to
the prisoner's medical condition and prognosis, and as to the recall
and resentencing procedures. If the inmate is deemed mentally unfit,
the warden or the warden's representative shall contact the inmate's
emergency contact and provide the information described in paragraph
(2).
   (5) The warden or the warden's representative shall provide the
prisoner and his or her family member, agent, or emergency contact,
as described in paragraph (4), updated information throughout the
recall and resentencing process with regard to the prisoner's medical
condition and the status of the prisoner's recall and resentencing
proceedings.
   (6) Notwithstanding any other provisions of this section, the
prisoner or his or her family member or designee may independently
request consideration for recall and resentencing by contacting the
chief medical officer at the prison or the secretary. Upon receipt of
the request, the chief medical officer and the warden or the warden'
s representative shall follow the procedures described in paragraph
(4). If the secretary determines that the prisoner satisfies the
criteria set forth in paragraph (2), the secretary or board may
recommend to the court that the prisoner's sentence be recalled. The
secretary shall submit a recommendation for release within 30 days in
the case of inmates sentenced to determinate terms and, in the case
of inmates sentenced to indeterminate terms, the secretary shall make
a recommendation to the Board of Parole Hearings with respect to the
inmates who have applied under this section. The board shall
consider this information and make an independent judgment pursuant
to paragraph (2) and make findings related thereto before rejecting
the request or making a recommendation to the court. This action
shall be taken at the next lawfully noticed board meeting.
   (7) A recommendation for recall submitted to the court by the
secretary or the Board of Parole Hearings shall include one or more
medical evaluations, a postrelease plan, and findings pursuant to
paragraph (2).
   (8) If possible, the matter shall be heard before the same judge
of the court who sentenced the prisoner.
   (9) If the court grants the recall and resentencing application,
the prisoner shall be released by the department within 48 hours of
receipt of the court's order, unless a longer time period is agreed
to by the inmate. At the time of release, the warden or the warden's
representative shall ensure that the prisoner has each of the
following in his or her possession: a discharge medical summary, full
medical records, state identification, parole medications, and all
property belonging to the prisoner. After discharge, any additional
records shall be sent to the prisoner's forwarding address.
   (10) The secretary shall issue a directive to medical and
correctional staff employed by the department that details the
guidelines and procedures for initiating a recall and resentencing
procedure. The directive shall clearly state that any prisoner who is
given a prognosis of six months or less to live is eligible for
recall and resentencing consideration, and that recall and
resentencing procedures shall be initiated upon that prognosis.
   (f) A sentence imposed under this article shall be subject to the
provisions of Sections 3000 and 3057 and other applicable provisions
of law.
   (g) A sentence to state prison for a determinate term for which
only one term is specified, is a sentence to state prison under this
section.
   (h) This section shall become operative on January 1, 2011.
  SEC. 163.  Section 1202.4 of the Penal Code is amended to read:
   1202.4.  (a) (1) It is the intent of the Legislature that a victim
of crime who incurs any economic loss as a result of the commission
of a crime shall receive restitution directly from any defendant
convicted of that crime.
   (2) Upon a person being convicted of any crime in the State of
California, the court shall order the defendant to pay a fine in the
form of a penalty assessment in accordance with Section 1464.
   (3) The court, in addition to any other penalty provided or
imposed under the law, shall order the defendant to pay both of the
following:
   (A) A restitution fine in accordance with subdivision (b).
   (B) Restitution to the victim or victims, if any, in accordance
with subdivision (f), which shall be enforceable as if the order were
a civil judgment.
   (b) In every case where a person is convicted of a crime, the
court shall impose a separate and additional restitution fine, unless
it finds compelling and extraordinary reasons for not doing so, and
states those reasons on the record.
   (1) The restitution fine shall be set at the discretion of the
court and commensurate with the seriousness of the offense, but shall
not be less than two hundred dollars ($200), and not more than ten
thousand dollars ($10,000), if the person is convicted of a felony,
and shall not be less than one hundred dollars ($100), and not more
than one thousand dollars ($1,000), if the person is convicted of a
misdemeanor.
   (2) In setting a felony restitution fine, the court may determine
the amount of the fine as the product of two hundred dollars ($200)
multiplied by the number of years of imprisonment the defendant is
ordered to serve, multiplied by the number of felony counts of which
the defendant is convicted.
   (c) The court shall impose the restitution fine unless it finds
compelling and extraordinary reasons for not doing so, and states
those reasons on the record. A defendant's inability to pay shall not
be considered a compelling and extraordinary reason not to impose a
restitution fine. Inability to pay may be considered only in
increasing the amount of the restitution fine in excess of the
two-hundred-dollar ($200) or one-hundred-dollar ($100) minimum. The
court may specify that funds confiscated at the time of the defendant'
s arrest, except for funds confiscated pursuant to Section 11469 of
the Health and Safety Code, be applied to the restitution fine if the
funds are not exempt for spousal or child support or subject to any
other legal exemption.
   (d) In setting the amount of the fine pursuant to subdivision (b)
in excess of the two-hundred-dollar ($200) or one-hundred-dollar
($100) minimum, the court shall consider any relevant factors
including, but not limited to, the defendant's inability to pay, the
seriousness and gravity of the offense and the circumstances of its
commission, any economic gain derived by the defendant as a result of
the crime, the extent to which any other person suffered any losses
as a result of the crime, and the number of victims involved in the
crime. Those losses may include pecuniary losses to the victim or his
or her dependents as well as intangible losses, such as
psychological harm caused by the crime. Consideration of a defendant'
s inability to pay may include his or her future earning capacity. A
defendant shall bear the burden of demonstrating his or her inability
to pay. Express findings by the court as to the factors bearing on
the amount of the fine shall not be required. A separate hearing for
the fine shall not be required.
   (e) The restitution fine shall not be subject to penalty
assessments authorized in Section 1464 of this code or Chapter 12
(commencing with Section 76000) of Title 8 of the Government Code, or
the state surcharge authorized in Section 1465.7 of this code, and
shall be deposited in the Restitution Fund in the State Treasury.
   (f) Except as provided in subdivisions (q) and (r), in every case
in which a victim has suffered economic loss as a result of the
defendant's conduct, the court shall require that the defendant make
restitution to the victim or victims in an amount established by
court order, based on the amount of loss claimed by the victim or
victims or any other showing to the court. If the amount of loss
cannot be ascertained at the time of sentencing, the restitution
order shall include a provision that the amount shall be determined
at the direction of the court. The court shall order full restitution
unless it finds compelling and extraordinary reasons for not doing
so, and states them on the record. The court may specify that funds
confiscated at the time of the defendant's arrest, except for funds
confiscated pursuant to Section 11469 of the Health and Safety Code,
be applied to the restitution order if the funds are not exempt for
spousal or child support or subject to any other legal exemption.
   (1) The defendant has the right to a hearing before a judge to
dispute the determination of the amount of restitution. The court may
modify the amount, on its own motion or on the motion of the
district attorney, the victim or victims, or the defendant. If a
motion is made for modification of a restitution order, the victim
shall be notified of that motion at least 10 days prior to the
proceeding held to decide the motion.
   (2) Determination of the amount of restitution ordered pursuant to
this subdivision shall not be affected by the indemnification or
subrogation rights of any third party. Restitution ordered pursuant
to this subdivision shall be ordered to be deposited to the
Restitution Fund to the extent that the victim, as defined in
subdivision (k), has received assistance from the Victim Compensation
Program pursuant to Chapter 5 (commencing with Section 13950) of
Part 4 of Division 3 of Title 2 of the Government Code.
   (3) To the extent possible, the restitution order shall be
prepared by the sentencing court, shall identify each victim and each
loss to which it pertains, and shall be of a dollar amount that is
sufficient to fully reimburse the victim or victims for every
determined economic loss incurred as the result of the defendant's
criminal conduct, including, but not limited to, all of the
following:
   (A) Full or partial payment for the value of stolen or damaged
property. The value of stolen or damaged property shall be the
replacement cost of like property, or the actual cost of repairing
the property when repair is possible.
   (B) Medical expenses.
   (C) Mental health counseling expenses.
   (D) Wages or profits lost due to injury incurred by the victim,
and if the victim is a minor, wages or profits lost by the minor's
parent, parents, guardian, or guardians, while caring for the injured
minor. Lost wages shall include any commission income as well as any
base wages. Commission income shall be established by evidence of
commission income during the 12-month period prior to the date of the
crime for which restitution is being ordered, unless good cause for
a shorter time period is shown.
   (E) Wages or profits lost by the victim, and if the victim is a
minor, wages or profits lost by the minor's parent, parents,
guardian, or guardians, due to time spent as a witness or in
assisting the police or prosecution. Lost wages shall include any
commission income as well as any base wages. Commission income shall
be established by evidence of commission income during the 12-month
period prior to the date of the crime for which restitution is being
ordered, unless good cause for a shorter time period is shown.
   (F) Noneconomic losses, including, but not limited to,
psychological harm, for felony violations of Section 288.
   (G) Interest, at the rate of 10 percent per annum, that accrues as
of the date of sentencing or loss, as determined by the court.
   (H) Actual and reasonable attorney's fees and other costs of
collection accrued by a private entity on behalf of the victim.
   (I) Expenses incurred by an adult victim in relocating away from
the defendant, including, but not limited to, deposits for utilities
and telephone service, deposits for rental housing, temporary lodging
and food expenses, clothing, and personal items. Expenses incurred
pursuant to this section shall be verified by law enforcement to be
necessary for the personal safety of the victim or by a mental health
treatment provider to be necessary for the emotional well-being of
the victim.
   (J) Expenses to install or increase residential security incurred
related to a crime, as defined in subdivision (c) of Section 667.5,
including, but not limited to, a home security device or system, or
replacing or increasing the number of locks.
   (K) Expenses to retrofit a residence or vehicle, or both, to make
the residence accessible to or the vehicle operational by the victim,
if the victim is permanently disabled, whether the disability is
partial or total, as a direct result of the crime.
   (4) (A) If, as a result of the defendant's conduct, the
Restitution Fund has provided assistance to or on behalf of a victim
or derivative victim pursuant to Chapter 5 (commencing with Section
13950) of Part 4 of Division 3 of Title 2 of the Government Code, the
amount of assistance provided shall be presumed to be a direct
result of the defendant's criminal conduct and shall be included in
the amount of the restitution ordered.
   (B) The amount of assistance provided by the Restitution Fund
shall be established by copies of bills submitted to the California
Victim Compensation and Government Claims Board reflecting the amount
paid by the board and whether the services for which payment was
made were for medical or dental expenses, funeral or burial expenses,
mental health counseling, wage or support losses, or rehabilitation.
Certified copies of these bills provided by the board and redacted
to protect the privacy and safety of the victim or any legal
privilege, together with a statement made under penalty of perjury by
the custodian of records that those bills were submitted to and were
paid by the board, shall be sufficient to meet this requirement.
   (C) If the defendant offers evidence to rebut the presumption
established by this paragraph, the court may release additional
information contained in the records of the board to the defendant
only after reviewing that information in camera and finding that the
information is necessary for the defendant to dispute the amount of
the restitution order.
   (5) Except as provided in paragraph (6), in any case in which an
order may be entered pursuant to this subdivision, the defendant
shall prepare and file a disclosure identifying all assets, income,
and liabilities in which the defendant held or controlled a present
or future interest as of the date of the defendant's arrest for the
crime for which restitution may be ordered. The financial disclosure
statements shall be made available to the victim and the board
pursuant to Section 1214. The disclosure shall be signed by the
defendant upon a form approved or adopted by the Judicial Council for
the purpose of facilitating the disclosure. Any defendant who
willfully states as true any material matter that he or she knows to
be false on the disclosure required by this subdivision is guilty of
a misdemeanor, unless this conduct is punishable as perjury or
another provision of law provides for a greater penalty.
   (6) A defendant who fails to file the financial disclosure
required in paragraph (5), but who has filed a financial affidavit or
financial information pursuant to subdivision (c) of Section 987,
shall be deemed to have waived the confidentiality of that affidavit
or financial information as to a victim in whose favor the order of
restitution is entered pursuant to subdivision (f). The affidavit or
information shall serve in lieu of the financial disclosure required
in paragraph (5), and paragraphs (7) to (10), inclusive, shall not
apply.
   (7) Except as provided in paragraph (6), the defendant shall file
the disclosure with the clerk of the court no later than the date set
for the defendant's sentencing, unless otherwise directed by the
court. The disclosure may be inspected or copied as provided by
subdivision (b), (c), or (d) of Section 1203.05.
   (8) In its discretion, the court may relieve the defendant of the
duty under paragraph (7) of filing with the clerk by requiring that
the defendant's disclosure be submitted as an attachment to, and be
available to, those authorized to receive the following:
   (A) Any report submitted pursuant to subparagraph (C) of paragraph
(2) of subdivision (b) of Section 1203 or subdivision (g) of Section
1203.
   (B) Any stipulation submitted pursuant to paragraph (4) of
subdivision (b) of Section 1203.
   (C) Any report by the probation officer, or any information
submitted by the defendant applying for a conditional sentence
pursuant to subdivision (d) of Section 1203.
   (9) The court may consider a defendant's unreasonable failure to
make a complete disclosure pursuant to paragraph (5) as any of the
following:
   (A) A circumstance in aggravation of the crime in imposing a term
under subdivision (b) of Section 1170.
   (B) A factor indicating that the interests of justice would not be
served by admitting the defendant to probation under Section 1203.
   (C) A factor indicating that the interests of justice would not be
served by conditionally sentencing the defendant under Section 1203.

   (D) A factor indicating that the interests of justice would not be
served by imposing less than the maximum fine and sentence fixed by
law for the case.
   (10) A defendant's failure or refusal to make the required
disclosure pursuant to paragraph (5) shall not delay entry of an
order of restitution or pronouncement of sentence. In appropriate
cases, the court may do any of the following:
   (A) Require the defendant to be examined by the district attorney
pursuant to subdivision (h).
   (B) If sentencing the defendant under Section 1170, provide that
the victim shall receive a copy of the portion of the probation
report filed pursuant to Section 1203.10 concerning the defendant's
employment, occupation, finances, and liabilities.
   (C) If sentencing the defendant under Section 1203, set a date and
place for submission of the disclosure required by paragraph (5) as
a condition of probation or suspended sentence.
   (11) If a defendant has any remaining unpaid balance on a
restitution order or fine 120 days prior to his or her scheduled
release from probation or 120 days prior to his or her completion of
a conditional sentence, the defendant shall prepare and file a new
and updated financial disclosure identifying all assets, income, and
liabilities in which the defendant holds or controls or has held or
controlled a present or future interest during the defendant's period
of probation or conditional sentence. The financial disclosure shall
be made available to the victim and the board pursuant to Section
1214. The disclosure shall be signed and prepared by the defendant on
the same form as described in paragraph (5). Any defendant who
willfully states as true any material matter that he or she knows to
be false on the disclosure required by this subdivision is guilty of
a misdemeanor, unless this conduct is punishable as perjury or
another provision of law provides for a greater penalty. The
financial disclosure required by this paragraph shall be filed with
the clerk of the court no later than 90 days prior to the defendant's
scheduled release from probation or completion of the defendant's
conditional sentence.
   (g) The court shall order full restitution unless it finds
compelling and extraordinary reasons for not doing so, and states
those reasons on the record. A defendant's inability to pay shall not
be considered a compelling and extraordinary reason not to impose a
restitution order, nor shall inability to pay be a consideration in
determining the amount of a restitution order.
   (h) The district attorney may request an order of examination
pursuant to the procedures specified in Article 2 (commencing with
Section 708.110) of Chapter 6 of Division 2 of Title 9 of Part 2 of
the Code of Civil Procedure, in order to determine the defendant's
financial assets for purposes of collecting on the restitution order.

   (i) A restitution order imposed pursuant to subdivision (f) shall
be enforceable as if the order were a civil judgment.
   (j) The making of a restitution order pursuant to subdivision (f)
shall not affect the right of a victim to recovery from the
Restitution Fund as otherwise provided by law, except to the extent
that restitution is actually collected pursuant
                    to the order. Restitution collected pursuant to
this subdivision shall be credited to any other judgments for the
same losses obtained against the defendant arising out of the crime
for which the defendant was convicted.
   (k) For purposes of this section, "victim" shall include all of
the following:
   (1) The immediate surviving family of the actual victim.
   (2) Any corporation, business trust, estate, trust, partnership,
association, joint venture, government, governmental subdivision,
agency, or instrumentality, or any other legal or commercial entity
when that entity is a direct victim of a crime.
   (3) Any person who has sustained economic loss as the result of a
crime and who satisfies any of the following conditions:
   (A) At the time of the crime was the parent, grandparent, sibling,
spouse, child, or grandchild of the victim.
   (B) At the time of the crime was living in the household of the
victim.
   (C) At the time of the crime was a person who had previously lived
in the household of the victim for a period of not less than two
years in a relationship substantially similar to a relationship
listed in subparagraph (A).
   (D) Is another family member of the victim, including, but not
limited to, the victim's fiance or fiancee, and who witnessed the
crime.
   (E) Is the primary caretaker of a minor victim.
   (4) Any person who is eligible to receive assistance from the
Restitution Fund pursuant to Chapter 5 (commencing with Section
13950) of Part 4 of Division 3 of Title 2 of the Government Code.
   (5) Any governmental entity that is responsible for repairing,
replacing, or restoring public or privately owned property that has
been defaced with graffiti or other inscribed material, as defined in
subdivision (e) of Section 594, and that has sustained an economic
loss as the result of a violation of Section 594, 594.3, 594.4,
640.5, 640.6, or 640.7.
   (l) At its discretion, the board of supervisors of any county may
impose a fee to cover the actual administrative cost of collecting
the restitution fine, not to exceed 10 percent of the amount ordered
to be paid, to be added to the restitution fine and included in the
order of the court, the proceeds of which shall be deposited in the
general fund of the county.
   (m) In every case in which the defendant is granted probation, the
court shall make the payment of restitution fines and orders imposed
pursuant to this section a condition of probation. Any portion of a
restitution order that remains unsatisfied after a defendant is no
longer on probation shall continue to be enforceable by a victim
pursuant to Section 1214 until the obligation is satisfied.
   (n) If the court finds and states on the record compelling and
extraordinary reasons why a restitution fine or full restitution
order should not be required, the court shall order, as a condition
of probation, that the defendant perform specified community service,
unless it finds and states on the record compelling and
extraordinary reasons not to require community service in addition to
the finding that restitution should not be required. Upon revocation
of probation, the court shall impose restitution pursuant to this
section.
   (o) The provisions of Section 13963 of the Government Code shall
apply to restitution imposed pursuant to this section.
   (p) The court clerk shall notify the California Victim
Compensation and Government Claims Board within 90 days of an order
of restitution being imposed if the defendant is ordered to pay
restitution to the board due to the victim receiving compensation
from the Restitution Fund. Notification shall be accomplished by
mailing a copy of the court order to the board, which may be done
periodically by bulk mail or electronic mail.
   (q) Upon conviction for a violation of Section 236.1, the court
shall, in addition to any other penalty or restitution, order the
defendant to pay restitution to the victim in any case in which a
victim has suffered economic loss as a result of the defendant's
conduct. The court shall require that the defendant make restitution
to the victim or victims in an amount established by court order,
based on the amount of loss claimed by the victim or victims or any
other showing to the court. In determining restitution pursuant to
this section, the court shall base its order upon the greatest of the
following: the gross value of the victim's labor or services based
upon the comparable value of similar services in the labor market in
which the offense occurred, the value of the victim's labor as
guaranteed under California law, the actual income derived by the
defendant from the victim's labor or services, or any other
appropriate means to provide reparations to the victim.
   (r) In addition to any other penalty or fine, the court shall
order any person who has been convicted of any violation of Section
653h, 653s, 653u, or 653w to make restitution to any owner or lawful
producer, or trade association acting on behalf of the owner or
lawful producer, of a phonograph record, disc, wire, tape, film, or
other device or article from which sounds or visual images are
derived that suffered economic loss resulting from the violation. For
the purpose of calculating restitution, the value of each
nonconforming article or device shall be based on the aggregate
wholesale value of lawfully manufactured and authorized devices or
articles from which sounds or visual images are devised, unless a
higher value can be proved in the case of (1) an unreleased audio
work or (2) an audiovisual work that, at the time of unauthorized
distribution, has not been made available in copies for sale to the
general public in the United States on a digital versatile disc. The
order of restitution shall also include reasonable costs incurred as
a result of any investigation of the violation undertaken by the
owner, lawful producer, or trade association acting on behalf of the
owner or lawful producer. "Aggregate wholesale value" means the
average wholesale value of lawfully manufactured and authorized sound
or audiovisual recordings. Proof of the specific wholesale value of
each nonconforming device or article is not required.
  SEC. 164.  Section 1202.8 of the Penal Code is amended to read:
   1202.8.  (a) Persons placed on probation by a court shall be under
the supervision of the county probation officer who shall determine
both the level and type of supervision consistent with the
court-ordered conditions of probation.
   (b) Commencing January 1, 2009, every person who has been assessed
with the State Authorized Risk Assessment Tool for Sex Offenders
(SARATSO) pursuant to Sections 290.04 to 290.06, inclusive, and who
has a SARATSO risk level of high shall be continuously electronically
monitored while on probation, unless the court determines that such
monitoring is unnecessary for a particular person. The monitoring
device used for these purposes shall be identified as one that
employs the latest available proven effective monitoring technology.
Nothing in this section prohibits probation authorities from using
electronic monitoring technology pursuant to any other provision of
law.
   (c) Within 30 days of a court making an order to provide
restitution to a victim or to the Restitution Fund, the probation
officer shall establish an account into which any restitution
payments that are not deposited into the Restitution Fund shall be
deposited.
   (d) Beginning January 1, 2009, and every two years thereafter,
each probation department shall report to the Corrections Standards
Authority all relevant statistics and relevant information regarding
the effectiveness of continuous electronic monitoring of offenders
pursuant to subdivision (b). The report shall include the costs of
monitoring and the recidivism rates of those persons who have been
monitored. The Corrections Standards Authority shall compile the
reports and submit a single report to the Legislature and the
Governor every two years through 2017.
  SEC. 165.  Section 1203.098 of the Penal Code is amended to read:
   1203.098.  (a) Unless otherwise provided, a person who works as a
facilitator in a batterers' intervention program that provides
programs for batterers pursuant to subdivision (c) of Section
1203.097 shall complete the following requirements before being
eligible to work as a facilitator in a batterers' intervention
program:
   (1) Forty hours of basic core training. A minimum of eight hours
of this instruction shall be provided by a shelter-based or
shelter-approved trainer. The core curriculum shall include the
following components:
   (A) A minimum of eight hours in basic domestic violence knowledge
focusing on victim safety and the role of domestic violence shelters
in a community-coordinated response.
   (B) A minimum of eight hours in multicultural, cross-cultural, and
multiethnic diversity and domestic violence.
   (C) A minimum of four hours in substance abuse and domestic
violence.
   (D) A minimum of four hours in intake and assessment, including
the history of violence and the nature of threats and substance
abuse.
   (E) A minimum of eight hours in group content areas focusing on
gender roles and socialization, the nature of violence, the dynamics
of power and control, and the effects of abuse on children and others
as required by Section 1203.097.
   (F) A minimum of four hours in group facilitation.
   (G) A minimum of four hours in domestic violence and the law,
ethics, all requirements specified by the probation department
pursuant to Section 1203.097, and the role of batterers' intervention
programs in a coordinated-community response.
   (H) Any person that provides documentation of coursework, or
equivalent training, that he or she has satisfactorily completed,
shall be exempt from that part of the training that was covered by
the satisfactorily completed coursework.
   (I) The coursework that this person performs shall count toward
the continuing education requirement.
   (2) Fifty-two weeks or no less than 104 hours in six months, as a
trainee in an approved batterers' intervention program with a minimum
of a two-hour group each week. A training program shall include at
least one of the following:
   (A) Cofacilitation internship in which an experienced facilitator
is present in the room during the group session.
   (B) Observation by a trainer of the trainee conducting a group
session via a one-way mirror.
   (C) Observation by a trainer of the trainee conducting a group
session via a video or audio recording.
   (D) Consultation or supervision twice a week in a six-month
program or once a week in a 52-week program.
   (3) An experienced facilitator is one who has the following
qualifications:
   (A) Documentation on file, approved by the agency, evidencing that
the experienced facilitator has the skills needed to provide quality
supervision and training.
   (B) Documented experience working with batterers for three years,
and a minimum of two years working with batterers' groups.
   (C) Documentation by January 1, 2003, of coursework or equivalent
training that demonstrates satisfactory completion of the 40-hour
basic core training.
   (b) A facilitator of a batterers' intervention program shall
complete, as a minimum continuing education requirement, 16 hours
annually of continuing education in either domestic violence or a
related field with a minimum of eight hours in domestic violence.
   (c) A person or agency with a specific hardship may request the
probation department, in writing, for an extension of time to
complete the training or to complete alternative training options.
   (d) (1) An experienced facilitator, as defined in paragraph (3) of
subdivision (a), is not subject to the supervision requirements of
this section, if he or she meets the requirements of subparagraph (C)
of paragraph (3) of subdivision (a).
   (2) This section does not apply to a person who provides batterers'
treatment through a jail education program if the person in charge
of that program determines that the person providing treatment has
adequate education or training in domestic violence or a related
field.
   (e) A person who satisfactorily completes the training
requirements of a county probation department whose training program
is equivalent to or exceeds the training requirements of this act
shall be exempt from the training requirements of this act.
  SEC. 166.  Section 1203.4 of the Penal Code is amended to read:
   1203.4.  (a) In any case in which a defendant has fulfilled the
conditions of probation for the entire period of probation, or has
been discharged prior to the termination of the period of probation,
or in any other case in which a court, in its discretion and the
interests of justice, determines that a defendant should be granted
the relief available under this section, the defendant shall, at any
time after the termination of the period of probation, if he or she
is not then serving a sentence for any offense, on probation for any
offense, or charged with the commission of any offense, be permitted
by the court to withdraw his or her plea of guilty or plea of nolo
contendere and enter a plea of not guilty; or, if he or she has been
convicted after a plea of not guilty, the court shall set aside the
verdict of guilty; and, in either case, the court shall thereupon
dismiss the accusations or information against the defendant and
except as noted below, he or she shall thereafter be released from
all penalties and disabilities resulting from the offense of which he
or she has been convicted, except as provided in Section 13555 of
the Vehicle Code. The probationer shall be informed, in his or her
probation papers, of this right and privilege and his or her right,
if any, to petition for a certificate of rehabilitation and pardon.
The probationer may make the application and change of plea in person
or by attorney, or by the probation officer authorized in writing.
However, in any subsequent prosecution of the defendant for any other
offense, the prior conviction may be pleaded and proved and shall
have the same effect as if probation had not been granted or the
accusation or information dismissed. The order shall state, and the
probationer shall be informed, that the order does not relieve him or
her of the obligation to disclose the conviction in response to any
direct question contained in any questionnaire or application for
public office, for licensure by any state or local agency, or for
contracting with the California State Lottery Commission.
   Dismissal of an accusation or information pursuant to this section
does not permit a person to own, possess, or have in his or her
custody or control any firearm or prevent his or her conviction under
Section 12021.
   Dismissal of an accusation or information underlying a conviction
pursuant to this section does not permit a person prohibited from
holding public office as a result of that conviction to hold public
office.
   This subdivision shall apply to all applications for relief under
this section which are filed on or after November 23, 1970.
   (b) Subdivision (a) of this section does not apply to any
misdemeanor that is within the provisions of Section 42002.1 of the
Vehicle Code, to any violation of subdivision (c) of Section 286,
Section 288, subdivision (c) of Section 288a, Section 288.5, or
subdivision (j) of Section 289, any felony conviction pursuant to
subdivision (d) of Section 261.5, or to any infraction.
   (c) (1) Except as provided in paragraph (2), subdivision (a) does
not apply to a person who receives a notice to appear or is otherwise
charged with a violation of an offense described in subdivisions (a)
to (e), inclusive, of Section 12810 of the Vehicle Code.
   (2) If a defendant who was convicted of a violation listed in
paragraph (1) petitions the court, the court in its discretion and in
the interests of justice may order the relief provided pursuant to
subdivision (a) to that defendant.
   (d) A person who petitions for a change of plea or setting aside
of a verdict under this section may be required to reimburse the
court for the actual costs of services rendered, whether or not the
petition is granted and the records are sealed or expunged, at a rate
to be determined by the court not to exceed one hundred fifty
dollars ($150), and to reimburse the county for the actual costs of
services rendered, whether or not the petition is granted and the
records are sealed or expunged, at a rate to be determined by the
county board of supervisors not to exceed one hundred fifty dollars
($150), and to reimburse any city for the actual costs of services
rendered, whether or not the petition is granted and the records are
sealed or expunged, at a rate to be determined by the city council
not to exceed one hundred fifty dollars ($150). Ability to make this
reimbursement shall be determined by the court using the standards
set forth in paragraph (2) of subdivision (g) of Section 987.8 and
shall not be a prerequisite to a person's eligibility under this
section. The court may order reimbursement in any case in which the
petitioner appears to have the ability to pay, without undue
hardship, all or any portion of the costs for services established
pursuant to this subdivision.
   (e) Relief shall not be granted under this section unless the
prosecuting attorney has been given 15 days' notice of the petition
for relief. The probation officer shall notify the prosecuting
attorney when a petition is filed, pursuant to this section.
   It shall be presumed that the prosecuting attorney has received
notice if proof of service is filed with the court.
   (f) If, after receiving notice pursuant to subdivision (e), the
prosecuting attorney fails to appear and object to a petition for
dismissal, the prosecuting attorney may not move to set aside or
otherwise appeal the grant of that petition.
   (g) Notwithstanding the above provisions or any other provision of
law, the Governor shall have the right to pardon a person convicted
of a violation of subdivision (c) of Section 286, Section 288,
subdivision (c) of Section 288a, Section 288.5, or subdivision (j) of
Section 289, if there are extraordinary circumstances.
  SEC. 167.  Chapter 3 (commencing with Section 1228) of Title 8 of
Part 2 of the Penal Code, as added by Section 36 of Chapter 28 of the
3rd Extraordinary Session of the Statutes of 2009, is repealed.
  SEC. 168.  Section 1229 of the Penal Code, as added by Section 2 of
Chapter 608 of the Statutes of 2009, is amended to read:
   1229.  As used in this chapter, the following definitions apply:
   (a) "Community corrections" means the placement of persons
convicted of a felony offense under probation supervision, with
conditions imposed by a court for a specified period.
   (b) "Chief probation officer" or "CPO" means the chief probation
officer for the county or city and county in which an adult offender
is subject to probation for the conviction of a felony offense.
   (c) "Community corrections program" means a program established
pursuant to this act consisting of a system of felony probation
supervision services dedicated to all of the following goals:
   (1) Enhancing public safety through the management and reduction
of offender risk while under felony probation supervision and upon
reentry from jail into the community.
   (2) Providing a range of probation supervision tools, sanctions,
and services applied to felony probationers based on a risk and needs
assessment for the purpose of reducing criminal conduct and
promoting behavioral change that results in reducing recidivism and
promoting the successful reintegration of offenders into the
community.
   (3) Maximizing offender restitution, reconciliation, and
restorative services to victims of crime.
   (4) Holding offenders accountable for their criminal behaviors and
for successful compliance with applicable court orders and
conditions of supervision.
   (5) Improving public safety outcomes for persons placed on
probation for a felony offense, as measured by their successful
completion of probation and the commensurate reduction in the rate of
felony probationers sent to prison as a result of a probation
revocation or conviction of a new crime.
   (d) "Evidence-based practices" refers to supervision policies,
procedures, programs, and practices demonstrated by scientific
research to reduce recidivism among individuals under probation,
parole, or postrelease supervision.
  SEC. 169.  Section 1230 of the Penal Code, as added by Section 2 of
Chapter 608 of the Statutes of 2009, is amended to read:
   1230.  (a) Each county is hereby authorized to establish in each
county treasury a Community Corrections Performance Incentives Fund
(CCPIF), to receive all amounts allocated to that county for purposes
of implementing this chapter.
   (b) In any fiscal year for which a county receives moneys to be
expended for the implementation of this chapter, the moneys,
including any interest, shall be made available to the CPO of that
county, within 30 days of the deposit of those moneys into the fund,
for the implementation of the community corrections program
authorized by this chapter.
   (1) The community corrections program shall be developed and
implemented by probation and advised by a local Community Corrections
Partnership.
   (2) The local Community Corrections Partnership shall be chaired
by the CPO and comprised of the following membership:
   (A) The presiding judge of the superior court, or his or her
designee.
   (B) A county supervisor or the chief administrative officer for
the county.
   (C) The district attorney.
   (D) The public defender.
   (E) The sheriff.
   (F) A chief of police.
   (G) The head of the county department of social services.
   (H) The head of the county department of mental health.
   (I) The head of the county department of employment.
   (J) The head of the county alcohol and substance abuse programs.
   (K) The head of the county office of education.
   (L) A representative from a community-based organization with
experience in successfully providing rehabilitative services to
persons who have been convicted of a criminal offense.
   (M) An individual who represents the interests of victims.
   (3) Funds allocated to probation pursuant to this act shall be
used to provide supervision and rehabilitative services for adult
felony offenders subject to probation, and shall be spent on
evidence-based community corrections practices and programs, as
defined in subdivision (c) of Section 1229, which may include, but
are not limited to, the following:
   (A) Implementing and expanding evidence-based risk and needs
assessments.
   (B) Implementing and expanding intermediate sanctions that
include, but are not limited to, electronic monitoring, mandatory
community service, home detention, day reporting, restorative justice
programs, work furlough programs, and incarceration in county jail
for up to 90 days.
   (C) Providing more intensive probation supervision.
   (D) Expanding the availability of evidence-based rehabilitation
programs including, but not limited to, drug and alcohol treatment,
mental health treatment, anger management, cognitive behavior
programs, and job training and employment services.
   (E) Evaluating the effectiveness of rehabilitation and supervision
programs and ensuring program fidelity.
   (4) The CPO shall have discretion to spend funds on any of the
above practices and programs consistent with this act but, at a
minimum, shall devote at least 5 percent of all funding received to
evaluate the effectiveness of those programs and practices
implemented with the funds provided pursuant to this chapter. A CPO
may petition the Administrative Office of the Courts to have this
restriction waived, and the Administrative Office of the Courts shall
have the authority to grant such a petition, if the CPO can
demonstrate that the department is already devoting sufficient funds
to the evaluation of these programs and practices.
   (5) Each probation department receiving funds under this chapter
shall maintain a complete and accurate accounting of all funds
received pursuant to this chapter.
  SEC. 170.  Section 1231 of the Penal Code, as added by Section 2 of
Chapter 608 of the Statutes of 2009, is amended to read:
   1231.  (a) Community corrections programs funded pursuant to this
act shall identify and track specific outcome-based measures
consistent with the goals of this act.
   (b) The Administrative Office of the Courts, in consultation with
the Chief Probation Officers of California, shall specify and define
minimum required outcome-based measures, which shall include, but not
be limited to, all of the following:
   (1) The percentage of persons on felony probation who are being
supervised in accordance with evidence-based practices.
   (2) The percentage of state moneys expended for programs that are
evidence-based, and a descriptive list of all programs that are
evidence-based.
   (3) Specification of supervision policies, procedures, programs,
and practices that were eliminated.
   (4) The percentage of persons on felony probation who successfully
complete the period of probation.
   (c) Each CPO receiving funding pursuant to Sections 1233 to
1233.6, inclusive, shall provide an annual written report to the
Administrative Office of the Courts and the Department of Corrections
and Rehabilitation evaluating the effectiveness of the community
corrections program, including, but not limited to, the data
described in subdivision (b).
   (d) The Administrative Office of the Courts shall, in consultation
with the CPO of each county and the Department of Corrections and
Rehabilitation, provide a quarterly statistical report to the
Department of Finance including, but not limited to, the following
statistical information for each county:
   (1) The number of felony filings.
   (2) The number of felony convictions.
   (3) The number of felony convictions in which the defendant was
sentenced to the state prison.
   (4) The number of felony convictions in which the defendant was
granted probation.
   (5) The adult felon probation population.
   (6) The number of felons who had their probation revoked and were
sent to prison for that revocation.
   (7) The number of adult felony probationers sent to state prison
for a conviction of a new felony offense, including when probation
was revoked or terminated.
  SEC. 171.  Section 1233.1 of the Penal Code, as added by Section 2
of Chapter 608 of the Statutes of 2009, is amended to read:
   1233.1.  After the conclusion of each calendar year following the
enactment of this section, the Director of Finance, in consultation
with the Department of Corrections and Rehabilitation, the Joint
Legislative Budget
Committee, the Chief Probation Officers of California, and the
Administrative Office of the Courts, shall calculate the following
for that calendar year:
   (a) The cost to the state to incarcerate in prison and supervise
on parole a probationer sent to prison. This calculation shall take
into consideration factors including, but not limited to, the average
length of stay in prison and on parole for probationers, as well as
the associated parole revocation rates, and revocation costs.
   (b) The statewide probation failure rate. The statewide probation
failure rate shall be calculated as the total number of adult felony
probationers statewide sent to prison in the previous year as a
percentage of the statewide adult felony probation population as of
June 30 of that year.
   (c)  The probation failure rate for each county. Each county's
probation failure rate shall be calculated as the number of adult
felony probationers sent to prison from that county in the previous
year as a percentage of the county's adult felony probation
population as of June 30 of that year.
   (d) An estimate of the number of adult felony probationers each
county successfully prevented from being sent to prison. For each
county, this estimate shall be calculated based on the reduction in
the county's probation failure rate as calculated annually pursuant
to subdivision (c) of this section and the county's baseline
probation failure rate as calculated pursuant to Section 1233. In
making this estimate, the Director of Finance, in consultation with
the Department of Corrections and Rehabilitation, the Joint
Legislative Budget Committee, the Chief Probation Officers of
California, and the Administrative Office of the Courts, shall adjust
the calculations to account for changes in each county's adult
felony probation caseload in the most recent completed calendar year
as compared to the county's adult felony probation population during
the period 2006 to 2008, inclusive.
   (e) In calculating probation failure rates for the state and
individual counties, the number of adult felony probationers sent to
prison shall include those adult felony probationers sent to state
prison for a revocation of probation, as well as adult felony
probationers sent to state prison for a conviction of a new felony
offense. The calculation shall also include adult felony probationers
who are sent to prison for conviction of a new crime and who
simultaneously have their probation terms terminated.
  SEC. 172.  Section 1233.7 of the Penal Code, as added by Section 2
of Chapter 608 of the Statutes of 2009, is amended to read:
   1233.7.  The moneys appropriated pursuant to this chapter shall be
used to supplement, not supplant, any other state or county
appropriation for a CPO or a probation department.
  SEC. 173.  Section 1463.23 of the Penal Code is amended to read:
   1463.23.  Notwithstanding Section 1463, out of the moneys
deposited with the county treasurer pursuant to Section 1463, fifty
dollars ($50) of each fine imposed pursuant to Section 4338 of the
Business and Professions Code; subdivision (c) of Section 11350,
subdivision (c) of Section 11377, or subdivision (d) of Section 11550
of the Health and Safety Code; or subdivision (b) of Section 264,
subdivision (m) of Section 286, subdivision (m) of Section 288a, or
Section 647.1 of this code, shall be deposited in a special account
in the county treasury which shall be used exclusively to pay for the
reasonable costs of establishing and providing for the county, or
any city within the county, an AIDS (acquired immune deficiency
syndrome) education program under the direction of the county health
department, in accordance with Chapter 2.71 (commencing with Section
1001.10) of Title 6, and for the costs of collecting and
administering funds received for purposes of this section.
  SEC. 174.  Section 6126.1 of the Penal Code is amended to read:
   6126.1.  (a) The Inspector General shall establish a certification
program for peace officers under the Inspector General's
jurisdiction. The peace officer training course shall be consistent
with the standard courses utilized by the Commission on Peace Officer
Standards and Training and other major investigative offices, such
as county sheriff and city police departments and the Department of
the California Highway Patrol.
   (b) Beginning January 1, 1999, peace officers under the Inspector
General's jurisdiction conducting investigations for the Office of
the Inspector General shall complete investigation training
consistent with standard courses utilized by other major law
enforcement investigative offices and be certified within six months
of employment.
   (c) Beginning January 1, 1999, all peace officers under the
Inspector General's jurisdiction shall successfully pass a
psychological screening exam before becoming employed with the Office
of the Inspector General.
  SEC. 175.  Section 6126.5 of the Penal Code is amended to read:
   6126.5.  (a) Notwithstanding any other provision of law, the
Inspector General, during regular business hours or at any other time
determined necessary by the Inspector General, shall have access to
and authority to examine and reproduce any and all books, accounts,
reports, vouchers, correspondence files, documents, and other
records, and to examine the bank accounts, money, or other property
of the Department of Corrections and Rehabilitation for any audit,
investigation, inspection, or contemporaneous oversight. Any officer
or employee of any agency or entity having these records or property
in his or her possession or under his or her control shall permit
access to, and examination and reproduction thereof consistent with
the provisions of this section, upon the request of the Inspector
General or his or her authorized representative.
   (b) For the purpose of conducting any audit, investigation,
inspection, or contemporaneous oversight, the Inspector General or
his or her authorized representative shall have access to the records
and property of any public or private entity or person subject to
review or regulation by the public agency or public entity being
audited, investigated, or overseen to the same extent that employees
or officers of that agency or public entity have access. No provision
of law or any memorandum of understanding or any other agreement
entered into between the employing entity and the employee or the
employee's representative providing for the confidentiality or
privilege of any records or property shall prevent disclosure
pursuant to subdivision (a). Access, examination, and reproduction
consistent with the provisions of this section shall not result in
the waiver of any confidentiality or privilege regarding any records
or property.
   (c) Any officer or person who fails or refuses to permit access,
examination, or reproduction, as required by this section, is guilty
of a misdemeanor.
   (d) The Inspector General may require any employee of the
Department of Corrections and Rehabilitation to be interviewed on a
confidential basis. Any employee requested to be interviewed shall
comply and shall have time afforded by the appointing authority for
the purpose of an interview with the Inspector General or his or her
designee. The Inspector General shall have the discretion to redact
the name or other identifying information of any person interviewed
from any public report issued by the Inspector General, where
required by law or where the failure to redact the information may
hinder prosecution or an action in a criminal, civil, or
administrative proceeding, or where the Inspector General determines
that disclosure of the information is not in the interests of
justice. It is not the purpose of these communications to address
disciplinary action or grievance procedures that may routinely occur.
If it appears that the facts of the case could lead to punitive
action, the Inspector General shall be subject to Sections 3303,
3307, 3307.5, 3308, and 3309 of the Government Code as if the
Inspector General were the employer, except that the Inspector
General shall not be subject to the provisions of any memorandum of
understanding or other agreement entered into between the employing
entity and the employee or the employee's representative that is in
conflict with, or adds to the requirements of, Sections 3303, 3307,
3307.5, 3308, and 3309 of the Government Code.
  SEC. 176.  Section 6128 of the Penal Code is amended to read:
   6128.  (a) The Office of the Inspector General may receive
communications from any individual, including those employed by any
department, board, or authority who believes he or she may have
information that may describe an improper governmental activity, as
that term is defined in subdivision (b) of Section 8547.2 of the
Government Code. It is not the purpose of these communications to
redress any single disciplinary action or grievance that may
routinely occur.
   (b) In order to properly respond to any allegation of improper
governmental activity, the Inspector General shall establish a
toll-free public telephone number for the purpose of identifying any
alleged wrongdoing by an employee of the Department of Corrections
and Rehabilitation. This telephone number shall be posted by the
department in clear view of all employees and the public. When
appropriate, the Inspector General shall initiate an investigation or
audit of any alleged improper governmental activity. However, any
request to conduct an investigation shall be in writing.
   (c) All identifying information, and any personal papers or
correspondence from any person who initiated the investigation shall
not be disclosed, except in those cases where the Inspector General
determines that disclosure of the information is necessary in the
interests of justice.
  SEC. 177.  Section 6131 of the Penal Code is amended to read:
   6131.  (a) Upon the completion of any audit conducted by the
Inspector General, he or she shall prepare a written report, which
shall be disclosed, along with all underlying materials the Inspector
General deems appropriate, to the Governor, the Secretary of the
Department of Corrections and Rehabilitation, the appropriate
director, chairperson, or law enforcement agency, and the
Legislature. Copies of all those written reports shall be posted on
the Inspector General's Internet Web site within 10 days of being
disclosed to the above-listed entities or persons.
   (b) Upon the completion of any investigation conducted by the
Inspector General, he or she shall prepare a complete written report,
which shall be held as confidential and disclosed in confidence,
along with all underlying investigative materials the Inspector
General deems appropriate, to the Governor, the Secretary of the
Department of Corrections and Rehabilitation, and the appropriate
director, chairperson, or law enforcement agency.
   (c) Upon the completion of any investigation conducted by the
Inspector General, he or she shall also prepare and issue on a
quarterly basis a public investigative report that includes all
investigations completed in the previous quarter. The public
investigative report shall differ from the complete investigative
report in the respect that the Inspector General shall have the
discretion to redact or otherwise protect the names of individuals,
specific locations, or other facts that, if not redacted, might
hinder prosecution related to the investigation, or where disclosure
of the information is otherwise prohibited by law, and to decline to
produce any of the underlying investigative materials. In a case
where allegations were deemed to be unfounded, all applicable
identifying information shall be redacted. The public investigative
report shall be made available to the public upon request and on a
quarterly basis as follows:
   (1) In those cases where an investigation is referred only for
disciplinary action before the State Personnel Board or for other
administrative proceedings, the employing entity shall, within 10
days of receipt of the State Personnel Board's order rendered in
other administrative proceedings, provide the Inspector General with
a copy of the order. The Inspector General shall attach the order to
the public investigative report on his or her Internet Web site and
provide copies of the report and order to the Legislature, as well as
to any complaining employee and any employee who was the subject of
the investigation.
   (2) In those cases where the employing entity and the employee
against whom disciplinary action has been taken enter into a
settlement agreement concerning the disciplinary action, the
employing entity shall, within 10 days of the settlement agreement
becoming final, notify the Inspector General in writing of that fact
and shall describe what disciplinary action, if any, was ultimately
imposed on the employee. The Inspector General shall include the
settlement information in the public investigative report on his or
her Internet Web site and provide copies of the report to the
Legislature, as well as to any complaining employee and any employee
who was the subject of the investigation.
   (3) In those cases where the employing entity declines to pursue
disciplinary action against an employee, the employing entity shall,
within 10 days of its decision, notify the Inspector General in
writing of its decision not to pursue disciplinary action, setting
forth the reasons for its decision. The Inspector General shall
include the decision and rationale in the public investigative report
on his or her Internet Web site and provide copies of the report to
the Legislature, as well as to any complaining employee and any
employee who was the subject of the investigation.
   (4) In those cases where an investigation has been referred for
possible criminal prosecution, and the applicable local law
enforcement agency or the Attorney General has decided to commence
criminal proceedings against an employee, the report shall be made
public at a time deemed appropriate by the Inspector General after
consultation with the local law enforcement agency or the Attorney
General, but in all cases no later than when discovery has been
provided to the defendant in the criminal proceedings. The Inspector
General shall thereafter post the public investigative report on his
or her Internet Web site and provide copies of the report to the
Legislature, as well as to any complaining employee and any employee
who was the subject of the investigation.
   (5) In those cases where the local law enforcement agency or the
Attorney General declines to commence criminal proceedings against an
employee, the local law enforcement agency or the Attorney General
shall, within 30 days of reaching that decision, notify the Inspector
General of that fact. The Inspector General shall include the
decision in the public investigative report on his or her Internet
Web site and provide copies of the report to the Legislature, as well
as to any complaining employee and any employee who was the subject
of the investigation.
   (6) In those cases where an investigation has been referred for
neither disciplinary action or other administrative proceedings, nor
for criminal prosecution, the Inspector General shall include the
decision not to refer the matter in the public investigative report
on his or her Internet Web site and provide copies of the report to
the Legislature, as well as to any complaining employee and any
employee who was the subject of the investigation.
  SEC. 178.  Section 11170 of the Penal Code is amended to read:
   11170.  (a) (1) The Department of Justice shall maintain an index
of all reports of child abuse and severe neglect submitted pursuant
to Section 11169. The index shall be continually updated by the
department and shall not contain any reports that are determined to
be unfounded. The department may adopt rules governing recordkeeping
and reporting pursuant to this article.
   (2) The department shall act only as a repository of reports of
suspected child abuse and severe neglect to be maintained in the
Child Abuse Central Index pursuant to paragraph (1). The submitting
agencies are responsible for the accuracy, completeness, and
retention of the reports described in this section. The department
shall be responsible for ensuring that the Child Abuse Central Index
accurately reflects the report it receives from the submitting
agency.
   (3) Information from an inconclusive or unsubstantiated report
filed pursuant to subdivision (a) of Section 11169 shall be deleted
from the Child Abuse Central Index after 10 years if no subsequent
report concerning the same suspected child abuser is received within
that time period. If a subsequent report is received within that
10-year period, information from any prior report, as well as any
subsequently filed report, shall be maintained on the Child Abuse
Central Index for a period of 10 years from the time the most recent
report is received by the department.
   (b) (1) The Department of Justice shall immediately notify an
agency that submits a report pursuant to Section 11169, or a
prosecutor who requests notification, of any information maintained
pursuant to subdivision (a) that is relevant to the known or
suspected instance of child abuse or severe neglect reported by the
agency. The agency shall make that information available to the
reporting health care practitioner who is treating a person reported
as a possible victim of known or suspected child abuse. The agency
shall make that information available to the reporting child
custodian, Child Abuse Prevention and Treatment Act (CAPTA) guardian
ad litem appointed under Rule 5.662 of the California Rules of Court,
or counsel appointed under Section 317 or 318 of the Welfare and
Institutions Code, or the appropriate licensing agency, if he or she
or the licensing agency is handling or investigating a case of known
or suspected child abuse or severe neglect.
   (2) When a report is made pursuant to subdivision (a) of Section
11166, or Section 11166.05, the investigating agency, upon completion
of the investigation or after there has been a final disposition in
the matter, shall inform the person required or authorized to report
of the results of the investigation and of any action the agency is
taking with regard to the child or family.
   (3) The Department of Justice shall make available to a law
enforcement agency, county welfare department, or county probation
department that is conducting a child abuse investigation relevant
information contained in the index.
   (4) The department shall make available to the State Department of
Social Services, or to any county licensing agency that has
contracted with the state for the performance of licensing duties, or
to a tribal court or tribal child welfare agency of a tribe or
consortium of tribes that has entered into an agreement with the
state pursuant to Section 10553.1 of the Welfare and Institutions
Code, information regarding a known or suspected child abuser
maintained pursuant to this section and subdivision (a) of Section
11169 concerning any person who is an applicant for licensure or any
adult who resides or is employed in the home of an applicant for
licensure or who is an applicant for employment in a position having
supervisorial or disciplinary power over a child or children, or who
will provide 24-hour care for a child or children in a residential
home or facility, pursuant to Section 1522.1 or 1596.877 of the
Health and Safety Code, or Section 8714, 8802, 8912, or 9000 of the
Family Code.
   (5) The Department of Justice shall make available to a Court
Appointed Special Advocate program that is conducting a background
investigation of an applicant seeking employment with the program or
a volunteer position as a Court Appointed Special Advocate, as
defined in Section 101 of the Welfare and Institutions Code,
information contained in the index regarding known or suspected child
abuse by the applicant.
   (6) For purposes of child death review, the Department of Justice
shall make available to the chairperson, or the chairperson's
designee, for each county child death review team, or the State Child
Death Review Council, information maintained in the Child Abuse
Central Index pursuant to subdivision (a) relating to the death of
one or more children and any prior child abuse or neglect
investigation reports maintained involving the same victims,
siblings, or suspects. Local child death review teams may share any
relevant information regarding case reviews involving child death
with other child death review teams.
   (7) The department shall make available to investigative agencies
or probation officers, or court investigators acting pursuant to
Section 1513 of the Probate Code, responsible for placing children or
assessing the possible placement of children pursuant to Article 6
(commencing with Section 300), Article 7 (commencing with Section
305), Article 10 (commencing with Section 360), or Article 14
(commencing with Section 601) of Chapter 2 of Part 1 of Division 2 of
the Welfare and Institutions Code, Article 2 (commencing with
Section 1510) or Article 3 (commencing with Section 1540) of Chapter
1 of Part 2 of Division 4 of the Probate Code, information regarding
a known or suspected child abuser contained in the index concerning
any adult residing in the home where the child may be placed, when
this information is requested for purposes of ensuring that the
placement is in the best interest of the child. Upon receipt of
relevant information concerning child abuse or neglect investigation
reports contained in the index from the Department of Justice
pursuant to this subdivision, the agency or court investigator shall
notify, in writing, the person listed in the Child Abuse Central
Index that he or she is in the index. The notification shall include
the name of the reporting agency and the date of the report.
   (8) The Department of Justice shall make available to a government
agency conducting a background investigation pursuant to Section
1031 of the Government Code of an applicant seeking employment as a
peace officer, as defined in Section 830, information regarding a
known or suspected child abuser maintained pursuant to this section
concerning the applicant.
   (9) The Department of Justice shall make available to a county
child welfare agency or delegated county adoption agency, as defined
in Section 8515 of the Family Code, conducting a background
investigation, or a government agency conducting a background
investigation on behalf of one of those agencies, information
regarding a known or suspected child abuser maintained pursuant to
this section and subdivision (a) of Section 11169 concerning any
applicant seeking employment or volunteer status with the agency who,
in the course of his or her employment or volunteer work, will have
direct contact with children who are alleged to have been, are at
risk of, or have suffered, abuse or neglect.
   (10) (A) Persons or agencies, as specified in subdivision (b), if
investigating a case of known or suspected child abuse or neglect, or
the State Department of Social Services or any county licensing
agency pursuant to paragraph (4), or a Court Appointed Special
Advocate program conducting a background investigation for employment
or volunteer candidates pursuant to paragraph (5), or an
investigative agency, probation officer, or court investigator
responsible for placing children or assessing the possible placement
of children pursuant to paragraph (7), or a government agency
conducting a background investigation of an applicant seeking
employment as a peace officer pursuant to paragraph (8), or a county
child welfare agency or delegated county adoption agency conducting a
background investigation of an applicant seeking employment or
volunteer status who, in the course of his or her employment or
volunteer work, will have direct contact with children who are
alleged to have been, are at risk of, or have suffered, abuse or
neglect, pursuant to paragraph (9), to whom disclosure of any
information maintained pursuant to subdivision (a) is authorized, are
responsible for obtaining the original investigative report from the
reporting agency, and for drawing independent conclusions regarding
the quality of the evidence disclosed, and its sufficiency for making
decisions regarding investigation, prosecution, licensing, placement
of a child, employment or volunteer positions with a CASA program,
or employment as a peace officer.
   (B) If Child Abuse Central Index information is requested by an
agency for the temporary placement of a child in an emergency
situation pursuant to Article 7 (commencing with Section 305) of
Chapter 2 of Part 1 of Division 2 of the Welfare and Institutions
Code, the department is exempt from the requirements of Section
1798.18 of the Civil Code if compliance would cause a delay in
providing an expedited response to the agency's inquiry and if
further delay in placement may be detrimental to the child.
   (11) (A) Whenever information contained in the Department of
Justice files is furnished as the result of an application for
employment or licensing or volunteer status pursuant to paragraph
(4), (5), (8), or (9), the Department of Justice may charge the
person or entity making the request a fee. The fee shall not exceed
the reasonable costs to the department of providing the information.
The only increase shall be at a rate not to exceed the legislatively
approved cost-of-living adjustment for the department. In no case
shall the fee exceed fifteen dollars ($15).
   (B) All moneys received by the department pursuant to this section
to process trustline applications for purposes of Chapter 3.35
(commencing with Section 1596.60) of Division 2 of the Health and
Safety Code shall be deposited in a special account in the General
Fund that is hereby established and named the Department of Justice
Child Abuse Fund. Moneys in the fund shall be available, upon
appropriation by the Legislature, for expenditure by the department
to offset the costs incurred to process trustline automated child
abuse or neglect system checks pursuant to this section.
   (C) All moneys, other than those described in subparagraph (B),
received by the department pursuant to this paragraph shall be
deposited in a special account in the General Fund which is hereby
created and named the Department of Justice Sexual Habitual Offender
Fund. The funds shall be available, upon appropriation by the
Legislature, for expenditure by the department to offset the costs
incurred pursuant to Chapter 9.5 (commencing with Section 13885) and
Chapter 10 (commencing with Section 13890) of Title 6 of Part 4, and
the DNA and Forensic Identification Data Base and Data Bank Act of
1998 (Chapter 6 (commencing with Section 295) of Title 9
                             of Part 1), and for maintenance and
improvements to the statewide Sexual Habitual Offender Program and
the California DNA offender identification file (CAL-DNA) authorized
by Chapter 9.5 (commencing with Section 13885) of Title 6 of Part 4
and the DNA and Forensic Identification Data Base and Data Bank Act
of 1998 (Chapter 6 (commencing with Section 295) of Title 9 of Part
1).
   (c) The Department of Justice shall make available to any agency
responsible for placing children pursuant to Article 7 (commencing
with Section 305) of Chapter 2 of Part 1 of Division 2 of the Welfare
and Institutions Code, upon request, relevant information concerning
child abuse or neglect reports contained in the index, when making a
placement with a responsible relative pursuant to Sections 281.5,
305, and 361.3 of the Welfare and Institutions Code. Upon receipt of
relevant information concerning child abuse or neglect reports
contained in the index from the Department of Justice pursuant to
this subdivision, the agency shall also notify in writing the person
listed in the Child Abuse Central Index that he or she is in the
index. The notification shall include the location of the original
investigative report and the submitting agency. The notification
shall be submitted to the person listed at the same time that all
other parties are notified of the information, and no later than the
actual judicial proceeding that determines placement.
   If Child Abuse Central Index information is requested by an agency
for the placement of a child with a responsible relative in an
emergency situation pursuant to Article 7 (commencing with Section
305) of Chapter 2 of Part 1 of Division 2 of the Welfare and
Institutions Code, the department is exempt from the requirements of
Section 1798.18 of the Civil Code if compliance would cause a delay
in providing an expedited response to the child protective agency's
inquiry and if further delay in placement may be detrimental to the
child.
   (d) The department shall make available any information maintained
pursuant to subdivision (a) to out-of-state law enforcement agencies
conducting investigations of known or suspected child abuse or
neglect only when an agency makes the request for information in
writing and on official letterhead, or as designated by the
department, identifying the suspected abuser or victim by name and
date of birth or approximate age. The request shall be signed by the
department supervisor of the requesting law enforcement agency. The
written requests shall cite the out-of-state statute or interstate
compact provision that requires that the information contained within
these reports shall be disclosed only to law enforcement,
prosecutorial entities, or multidisciplinary investigative teams, and
shall cite the safeguards in place to prevent unlawful disclosure of
any confidential information provided by the requesting state or the
applicable interstate compact provision.
   (e) (1) The department shall make available to an out-of-state
agency, for purposes of approving a prospective foster or adoptive
parent in compliance with the Adam Walsh Child Protection and Safety
Act of 2006 (P.L. 109-248), information regarding a known or
suspected child abuser maintained pursuant to subdivision (a)
concerning the prospective foster or adoptive parent, and any other
adult living in the home of the prospective foster or adoptive
parent. The department shall make that information available only
when the out-of-state agency makes the request indicating that
continual compliance will be maintained with the requirement in
paragraph (20) of subdivision (a) of Section 671 of Title 42 of the
United States Code that requires the state to have in place
safeguards to prevent the unauthorized disclosure of information in
any child abuse and neglect registry maintained by the state and
prevent the information from being used for a purpose other than the
conducting of background checks in foster or adoption placement
cases.
   (2) With respect to any information provided by the department in
response to the out-of-state agency's request, the out-of-state
agency is responsible for obtaining the original investigative report
from the reporting agency, and for drawing independent conclusions
regarding the quality of the evidence disclosed and its sufficiency
for making decisions regarding the approval of prospective foster or
adoptive parents.
   (3) (A) Whenever information contained in the index is furnished
pursuant to this subdivision, the department shall charge the
out-of-state agency making the request a fee. The fee shall not
exceed the reasonable costs to the department of providing the
information. The only increase shall be at a rate not to exceed the
legislatively approved cost-of-living adjustment for the department.
In no case shall the fee exceed fifteen dollars ($15).
   (B) All moneys received by the department pursuant to this
subdivision shall be deposited in the Department of Justice Child
Abuse Fund, established under subparagraph (B) of paragraph (11) of
subdivision (b). Moneys in the fund shall be available, upon
appropriation by the Legislature, for expenditure by the department
to offset the costs incurred to process requests for information
pursuant to this subdivision.
   (f) (1) Any person may determine if he or she is listed in the
Child Abuse Central Index by making a request in writing to the
Department of Justice. The request shall be notarized and include the
person's name, address, date of birth, and either a social security
number or a California identification number. Upon receipt of a
notarized request, the Department of Justice shall make available to
the requesting person information identifying the date of the report
and the submitting agency. The requesting person is responsible for
obtaining the investigative report from the submitting agency
pursuant to paragraph (11) of subdivision (b) of Section 11167.5.
   (2) No person or agency shall require or request another person to
furnish a copy of a record concerning himself or herself, or
notification that a record concerning himself or herself exists or
does not exist, pursuant to paragraph (1).
   (g) If a person is listed in the Child Abuse Central Index only as
a victim of child abuse or neglect, and that person is 18 years of
age or older, that person may have his or her name removed from the
index by making a written request to the Department of Justice. The
request shall be notarized and include the person's name, address,
social security number, and date of birth.
  SEC. 179.  Section 11411 of the Penal Code is amended to read:
   11411.  (a) Any person who hangs a noose, knowing it to be a
symbol representing a threat to life, on the private property of
another, without authorization, for the purpose of terrorizing the
owner or occupant of that private property or in reckless disregard
of the risk of terrorizing the owner or occupant of that private
property, or who hangs a noose, knowing it to be a symbol
representing a threat to life, on the property of a primary school,
junior high school, high school, college campus, public park, or
place of employment, for the purpose of terrorizing any person who
attends or works at the school, park, or place of employment, or who
is otherwise associated with the school, park, or place of
employment, shall be punished by imprisonment in a county jail not to
exceed one year, or by a fine not to exceed five thousand dollars
($5,000), or by both the fine and imprisonment for the first
conviction or by imprisonment in a county jail not to exceed one
year, or by a fine not to exceed fifteen thousand dollars ($15,000),
or by both the fine and imprisonment for any subsequent conviction.
   (b) Any person who places or displays a sign, mark, symbol,
emblem, or other physical impression, including, but not limited to,
a Nazi swastika, on the private property of another, without
authorization, for the purpose of terrorizing the owner or occupant
of that private property or in reckless disregard of the risk of
terrorizing the owner or occupant of that private property shall be
punished by imprisonment in a county jail not to exceed one year, by
a fine not to exceed five thousand dollars ($5,000), or by both the
fine and imprisonment for the first conviction and by imprisonment in
a county jail not to exceed one year, by a fine not to exceed
fifteen thousand dollars ($15,000), or by both the fine and
imprisonment for any subsequent conviction.
   (c) Any person who engages in a pattern of conduct for the purpose
of terrorizing the owner or occupant of private property or in
reckless disregard of terrorizing the owner or occupant of that
private property, by placing or displaying a sign, mark, symbol,
emblem, or other physical impression, including, but not limited to,
a Nazi swastika, on the private property of another on two or more
occasions, shall be punished by imprisonment in the state prison for
16 months or 2 or 3 years, by a fine not to exceed ten thousand
dollars ($10,000), or by both the fine and imprisonment, or by
imprisonment in a county jail not to exceed one year, by a fine not
to exceed five thousand dollars ($5,000), or by both the fine and
imprisonment. A violation of this subdivision shall not constitute
felonious conduct for purposes of Section 186.22.
   (d) Any person who burns or desecrates a cross or other religious
symbol, knowing it to be a religious symbol, on the private property
of another without authorization for the purpose of terrorizing the
owner or occupant of that private property or in reckless disregard
of the risk of terrorizing the owner or occupant of that private
property, or who burns, desecrates, or destroys a cross or other
religious symbol, knowing it to be a religious symbol, on the
property of a primary school, junior high school, or high school for
the purpose of terrorizing any person who attends or works at the
school or who is otherwise associated with the school, shall be
punished by imprisonment in the state prison for 16 months or 2 or 3
years, by a fine of not more than ten thousand dollars ($10,000), or
by both the fine and imprisonment, or by imprisonment in a county
jail not to exceed one year, by a fine not to exceed five thousand
dollars ($5,000), or by both the fine and imprisonment for the first
conviction and by imprisonment in the state prison for 16 months or 2
or 3 years, by a fine of not more than ten thousand dollars
($10,000), or by both the fine and imprisonment, or by imprisonment
in a county jail not to exceed one year, by a fine not to exceed
fifteen thousand dollars ($15,000), or by both the fine and
imprisonment for any subsequent conviction.
   (e) As used in this section, "terrorize" means to cause a person
of ordinary emotions and sensibilities to fear for personal safety.
   (f) The provisions of this section are severable. If any provision
of this section or its application is held invalid, that invalidity
shall not affect other provisions or applications that can be given
effect without the invalid provision or application.
  SEC. 180.  Section 13821 of the Penal Code is amended to read:
   13821.  (a) Of the amount deposited in the Local Safety and
Protection Account in the Transportation Tax Fund authorized by
Section 10752.2 of the Revenue and Taxation Code, the Controller
shall allocate 12.68 percent in the 2008-09 fiscal year and 11.42
percent in the 2009-10 fiscal year, and each fiscal year thereafter,
to the California Emergency Management Agency. The Controller shall
allocate these funds on a quarterly basis beginning April 1, 2009.
   (b) These funds shall be allocated by the California Emergency
Management Agency according to the agency's existing programmatic
guidelines and consistent with the programs approved in the Budget
Act of 2008 (Chapters 268 and 269 of the Statutes of 2008). Of the
amount allocated pursuant to subdivision (a), the California
Emergency Management Agency shall distribute these funds according to
the following percentages:
   (1) The California Multi-Jurisdictional Methamphetamine
Enforcement Teams shall receive 33.95 percent in the 2008-09 fiscal
year and each fiscal year thereafter.
   (2) The Multi-Agency Gang Enforcement Consortium shall receive
0.15 percent in the 2008-09 fiscal year, and each fiscal year
thereafter.
   (3) The CALGANG program administered by the Department of Justice
shall receive 0.47 percent in the 2008-09 fiscal year, and each
fiscal year thereafter.
   (4) The Evidentiary Medical Training Program shall receive 1.02
percent in the 2008-09 fiscal year and each fiscal year thereafter.
   (5) The Public Prosecutors and Public Defenders Legal Training
program shall receive 0.01 percent in the 2008-09 fiscal year and
each fiscal year thereafter.
   (6) The Sexual Assault Felony Enforcement Teams, authorized by
Section 13887, shall receive 8.93 percent in the 2008-09 fiscal year
and each fiscal year thereafter.
   (7) The Vertical Prosecution Block Grant Program shall receive
25.35 percent in the 2008-09 fiscal year and each fiscal year
thereafter.
   (8) The High Technology Theft Apprehension and Prosecution
Program, authorized by Section 13848.2, shall receive 20.84 percent
in the 2008-09 fiscal year, and each fiscal year thereafter.
   (9) The Gang Violence Suppression Program, authorized by Section
13826.1, shall receive 2.8 percent in the 2008-09 fiscal year and
each fiscal year thereafter.
   (10) The Central Valley and Central Coast Rural Crime Prevention
Programs, authorized by Sections 14170 and 14180, shall receive 6.49
percent in the 2008-09 fiscal year and each fiscal year thereafter.
   (c) Beginning in the 2009-10 fiscal year and each fiscal year
thereafter, the California Emergency Management Agency may retain up
to 3 percent of the funds allocated in subdivision (a) for program
administrative costs.
  SEC. 181.  Section 13823.16 of the Penal Code is amended to read:
   13823.16.  (a) The Comprehensive Statewide Domestic Violence
Program established pursuant to Section 13823.15 shall be
collaboratively administered by the California Emergency Management
Agency (Cal EMA) and an advisory council. The membership of the Cal
EMA Domestic Violence Advisory Council shall consist of experts in
the provision of either direct or intervention services to victims of
domestic violence and their children, within the scope and intention
of the Comprehensive Statewide Domestic Violence Assistance Program.

   (b) The membership of the council shall consist of domestic
violence victims' advocates, battered women service providers, at
least one representative of service providers serving the lesbian,
gay, bisexual, and transgender community in connection with domestic
violence, and representatives of women's organizations, law
enforcement, and other groups involved with domestic violence. At
least one-half of the council membership shall consist of domestic
violence victims' advocates or battered women service providers from
organizations such as the California Partnership to End Domestic
Violence. It is the intent of the Legislature that the council
membership reflect the ethnic, racial, cultural, and geographic
diversity of the state. The council shall be composed of no more than
13 voting members and 2 nonvoting ex officio members who shall be
appointed, as follows:
   (1) Seven voting members shall be appointed by the Governor.
   (2) Three voting members shall be appointed by the Speaker of the
Assembly.
   (3) Three voting members shall be appointed by the Senate
Committee on Rules.
   (4) Two nonvoting ex officio members shall be Members of the
Legislature, one appointed by the Speaker of the Assembly and one
appointed by the Senate Committee on Rules. Any Member of the
Legislature appointed to the council shall meet with the council and
participate in its activities to the extent that participation is not
incompatible with his or her position as a Member of the
Legislature.
   (c) The Cal EMA shall collaborate closely with the council in
developing funding priorities, framing the request for proposals, and
soliciting proposals.
   (d) This section shall remain in effect only until January 1,
2015, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2015, deletes or extends
that date.
  SEC. 182.  Section 13848.6 of the Penal Code is amended to read:
   13848.6.  (a) The High Technology Crime Advisory Committee is
hereby established for the purpose of formulating a comprehensive
written strategy for addressing high technology crime throughout the
state, with the exception of crimes that occur on state property or
are committed against state employees, and to advise the California
Emergency Management Agency on the appropriate disbursement of funds
to regional task forces.
   (b) This strategy shall be designed to be implemented through
regional task forces. In formulating that strategy, the committee
shall identify various priorities for law enforcement attention,
including the following goals:
   (1) To apprehend and prosecute criminal organizations, networks,
and groups of individuals engaged in the following activities:
   (A) Theft of computer components and other high technology
products.
   (B) Violations of Sections 211, 350, 351a, 459, 496, 537e, 593d,
593e, 653h, 653s, and 653w.
   (C) Theft of telecommunications services and other violations of
Sections 502.7 and 502.8.
   (D) Counterfeiting of negotiable instruments and other valuable
items through the use of computer technology.
   (E) Creation and distribution of counterfeit software and other
digital information, including the use of counterfeit trademarks to
misrepresent the origin of that software or digital information.
   (F) Creation and distribution of pirated sound recordings or
audiovisual works or the failure to disclose the origin of a
recording or audiovisual work.
   (2) To apprehend and prosecute individuals and groups engaged in
the unlawful access, destruction, or unauthorized entry into and use
of private, corporate, or government computers and networks,
including wireless and wire line communications networks and law
enforcement dispatch systems, and the theft, interception,
manipulation, destruction, and unauthorized disclosure of data stored
within those computers.
   (3) To apprehend and prosecute individuals and groups engaged in
the theft of trade secrets.
   (4) To investigate and prosecute high technology crime cases
requiring coordination and cooperation between regional task forces
and local, state, federal, and international law enforcement
agencies.
   (c) The Secretary of California Emergency Management shall appoint
the following members to the committee:
   (1) A designee of the California District Attorneys Association.
   (2) A designee of the California State Sheriffs Association.
   (3) A designee of the California Police Chiefs Association.
   (4) A designee of the Attorney General.
   (5) A designee of the Department of the California Highway Patrol.

   (6) A designee of the High Technology Crime Investigation
Association.
   (7) A designee of the California Emergency Management Agency.
   (8) A designee of the American Electronic Association to represent
California computer system manufacturers.
   (9) A designee of the American Electronic Association to represent
California computer software producers.
   (10) A designee of CTIA - The Wireless Association.
   (11) A representative of the California Internet industry.
   (12) A designee of the Semiconductor Equipment and Materials
International.
   (13) A designee of the California Cable & Telecommunications
Association.
   (14) A designee of the Motion Picture Association of America.
   (15) A designee of the California Communications Associations
(CalCom).
   (16) A representative of the California banking industry.
   (17) A representative of the Office of Information Security and
Privacy Protection.
   (18) A representative of the Department of Finance.
   (19) A representative of the State Chief Information Officer.
   (20) A representative of the Recording Industry of America.
   (21) A representative of the Consumers Union.
   (d) The Secretary of California Emergency Management shall
designate the Chairperson of the High Technology Crime Advisory
Committee from the appointed members.
   (e) The advisory committee shall not be required to meet more than
12 times per year. The advisory committee may create subcommittees
of its own membership, and each subcommittee shall meet as often as
the subcommittee members find necessary. It is the intent of the
Legislature that all advisory committee members shall actively
participate in all advisory committee deliberations required by this
chapter.
   Any member who, without advance notice to the Secretary of
California Emergency Management and without designating an
alternative representative, misses three scheduled meetings in any
calendar year for any reason other than severe temporary illness or
injury (as determined by the secretary) shall automatically be
removed from the advisory committee. If a member wishes to send an
alternative representative in his or her place, advance written
notification of this substitution shall be presented to the executive
director. This notification shall be required for each meeting the
appointed member elects not to attend.
   Members of the advisory committee shall receive no compensation
for their services, but shall be reimbursed for travel and per diem
expenses incurred as a result of attending meetings sponsored by the
California Emergency Management Agency.
   (f) The Secretary of California Emergency Management, in
consultation with the High Technology Crime Advisory Committee, shall
develop specific guidelines and administrative procedures for the
selection of projects to be funded by the High Technology Theft
Apprehension and Prosecution Program, which guidelines shall include
the following selection criteria:
   (1) Each regional task force that seeks funds shall submit a
written application to the committee setting forth in detail the
proposed use of the funds.
   (2) In order to qualify for the receipt of funds, each proposed
regional task force submitting an application shall provide written
evidence that the agency meets either of the following conditions:
   (A) The regional task force devoted to the investigation and
prosecution of high technology related crimes is comprised of local
law enforcement and prosecutors, and has been in existence for at
least one year prior to the application date.
   (B) At least one member of the task force has at least three years
of experience in investigating or prosecuting cases of suspected
high technology crime.
   (3) Each regional task force shall be identified by a name that is
appropriate to the area that it serves. In order to qualify for
funds, a regional task force shall be comprised of local law
enforcement and prosecutors from at least two counties. At the time
of funding, the proposed task force shall also have at least one
investigator assigned to it from a state law enforcement agency. Each
task force shall be directed by a local steering committee composed
of representatives of participating agencies and members of the local
high technology industry.
   (4) The California High Technology Crimes Task Force shall be
comprised of each regional task force developed pursuant to this
subdivision.
   (5) Additional criteria that shall be considered by the advisory
committee in awarding grant funds shall include, but not be limited
to, the following:
   (A) The number of high technology crime cases filed in the prior
year.
   (B) The number of high technology crime cases investigated in the
prior year.
   (C) The number of victims involved in the cases filed.
   (D) The total aggregate monetary loss suffered by the victims,
including individuals, associations, institutions, or corporations,
as a result of the high technology crime cases filed, and those under
active investigation by that task force.
   (6) Each regional task force that has been awarded funds
authorized under the High Technology Theft Apprehension and
Prosecution Program during the previous grant-funding cycle, upon
reapplication for funds to the committee in each successive year,
shall be required to submit a detailed accounting of funds received
and expended in the prior year in addition to any information
required by this section. The accounting shall include all of the
following information:
   (A) The amount of funds received and expended.
   (B) The use to which those funds were put, including payment of
salaries and expenses, purchase of equipment and supplies, and other
expenditures by type.
   (C) The number of filed complaints, investigations, arrests, and
convictions that resulted from the expenditure of the funds.
   (g) The committee shall annually review the effectiveness of the
California High Technology Crimes Task Force in deterring,
investigating, and prosecuting high technology crimes and provide its
findings in a report to the Legislature and the Governor. This
report shall be based on information provided by the regional task
forces in an annual report to the committee which shall detail the
following:
   (1) Facts based upon, but not limited to, the following:
   (A) The number of high technology crime cases filed in the prior
year.
   (B) The number of high technology crime cases investigated in the
prior year.
   (C) The number of victims involved in the cases filed.
   (D) The number of convictions obtained in the prior year.
   (E) The total aggregate monetary loss suffered by the victims,
including individuals, associations, institutions, corporations, and
other relevant public entities, according to the number of cases
filed, investigations, prosecutions, and convictions obtained.
   (2) An accounting of funds received and expended in the prior
year, which shall include all of the following:
   (A) The amount of funds received and expended.
   (B) The uses to which those funds were put, including payment of
salaries and expenses, purchase of supplies, and other expenditures
of funds.
   (C) Any other relevant information requested.
  SEC. 183.  Section 14029.5 of the Penal Code is amended to read:
   14029.5.  (a) (1) No person or private entity shall post on the
Internet the home address, the telephone number, or personal
identifying information that discloses the location of any witness or
witness' family member participating in the Witness Relocation and
Assistance Program (WRAP) with the intent that another person
imminently use that information to commit a crime involving violence
or a threat of violence against that witness or witness' family
member.
                                                  (2) A violation of
this subdivision is a misdemeanor punishable by a fine of up to two
thousand five hundred dollars ($2,500), or imprisonment of up to six
months in a county jail, or by both that fine and imprisonment.
   (3) A violation of this subdivision that leads to the bodily
injury of the witness, or of any of the witness' family members who
are participating in the program, is a misdemeanor punishable by a
fine of up to five thousand dollars ($5,000), or imprisonment of up
to one year in a county jail, or by both that fine and imprisonment.
   (b) Upon admission to WRAP, local or state prosecutors shall give
each participant a written opt-out form for submission to relevant
Internet search engine companies or entities. This form shall notify
entities of the protected person and prevent the inclusion of the
participant's addresses and telephone numbers in public Internet
search databases.
   (c) A business, state or local agency, private entity, or person
that receives the opt-out form of a WRAP participant pursuant to this
section shall remove the participant's personal information from
public display on the Internet within two business days of delivery
of the opt-out form, and shall continue to ensure that this
information is not reposted on the same Internet Web site, a
subsidiary site, or any other Internet Web site maintained by the
recipient of the opt-out form. No business, state or local agency,
private entity, or person that has received an opt-out form from a
WRAP participant shall solicit, sell, or trade on the Internet the
home address or telephone number of that participant.
   (d) A business, state or local agency, private entity, or person
that violates subdivision (c) shall be subject to a civil penalty for
each violation in the amount of five thousand dollars ($5,000). An
action for a civil penalty under this subdivision may be brought by
any public prosecutor in the name of the people of the State of
California and the penalty imposed shall be enforceable as a civil
judgment.
   (e) A witness whose home address or telephone number is made
public as a result of a violation of subdivision (c) may bring an
action seeking injunctive or declaratory relief in any court of
competent jurisdiction. If a jury or court finds that a violation has
occurred, it may grant injunctive or declaratory relief and shall
award the witness court costs and reasonable attorney's fees.
   (f) Notwithstanding any other provision of law, a witness whose
home address or telephone number is solicited, sold, or traded in
violation of subdivision (c) may bring an action in any court of
competent jurisdiction. If a jury or court finds that a violation has
occurred, it shall award damages to that witness in an amount up to
a maximum of three times the actual damages, but in no case less than
four thousand dollars ($4,000).
   (g) Nothing in this section shall preclude prosecution under any
other provision of law.
  SEC. 184.  Section 10100 of the Public Contract Code is amended to
read:
   10100.  This chapter may be cited as the State Contract Act.
  SEC. 185.  Section 10101 of the Public Contract Code is amended to
read:
   10101.  (a) Contracts for the purchase of supplies or materials,
which are purchased pursuant to Chapter 2 (commencing with Section
10290), are not subject to this chapter, even though the seller is
required to perform some incidental work or service in connection
with the delivery of the material or supplies.
   (b) Contracts for which emergency work or remedial measures are
required are not subject to this chapter if the work or remedial
measures are necessary to immediately avert, alleviate, repair, or
mitigate destruction of property caused by the accidental or
unplanned release of toxic substances and are necessary to protect
the health, safety, and welfare of the general public.
  SEC. 186.  Section 10102 of the Public Contract Code is amended to
read:
   10102.  Improvements on the property of the state on the
waterfront of the City and County of San Francisco under the
jurisdiction of the San Francisco Port Commission are not subject to
this chapter.
  SEC. 187.  Section 10103 of the Public Contract Code is amended to
read:
   10103.  Work done directly by any public utility company pursuant
to order of the Public Utilities Commission or other public authority
is not subject to this chapter, whether or not done under public
supervision or paid for in whole or part out of public funds.
  SEC. 188.  Section 10103.5 of the Public Contract Code is amended
to read:
   10103.5.  Work performed by prisoners pursuant to an order by the
Secretary of the Department of Corrections and Rehabilitation or by
the Prison Industry Authority is not subject to this chapter,
provided that the total cost of a project for the construction of
new, previously unoccupied prison facilities or additions to an
existing facility shall not exceed fifty thousand dollars ($50,000)
unless it is first approved by the State Public Works Board.
  SEC. 189.  Section 10104 of the Public Contract Code is amended to
read:
   10104.  As used in this chapter, "mobilization" includes
preparatory work and operations, including, but not limited to, those
necessary for the movement of personnel, equipment, supplies and
incidentals to the project site, for the establishment of all
offices, buildings and other facilities necessary for work on the
project, and for all other work and operations which must be
performed or costs incurred prior to beginning work on the various
items on the project site.
  SEC. 190.  Section 10105 of the Public Contract Code is amended to
read:
   10105.  (a) As used in this chapter, "project" includes the
erection, construction, alteration, repair, or improvement of any
state structure, building, road, or other state improvement of any
kind that will exceed a total cost calculated pursuant to subdivision
(b).
   (b) The total cost limit for calendar year 2010 shall be two
hundred fifty thousand dollars ($250,000), and at two year intervals
thereafter, the total cost limit shall be adjusted upward or downward
by the Director of Finance to reflect the percentage change in the
annual California Construction Index as used by the Department of
General Services. The amount shall be rounded off to the nearest
one-thousand-dollar ($1,000) figure.
  SEC. 191.  Section 10262.5 of the Public Contract Code is amended
to read:
   10262.5.  (a) Notwithstanding any other provision of law, a prime
contractor or subcontractor shall pay to any subcontractor, not later
than 10 days after receipt of each progress payment, the respective
amounts allowed the contractor on account of the work performed by
the subcontractors, to the extent of each subcontractor's interest
therein. In the event that there is a good faith dispute over all or
any portion of the amount due on a progress payment from the prime
contractor or subcontractor to a subcontractor, then the prime
contractor or subcontractor may withhold no more than 150 percent of
the disputed amount.
   Any contractor who violates this section shall pay to the
subcontractor a penalty of 2 percent of the amount due per month for
every month that payment is not made. In any action for the
collection of funds wrongfully withheld, the prevailing party shall
be entitled to his or her attorney's fees and costs.
   (b) This section shall not be construed to limit or impair any
contractual, administrative, or judicial remedies otherwise available
to a contractor or a subcontractor in the event of a dispute
involving late payment or nonpayment by a contractor or deficient
subcontract performance or nonperformance by a subcontractor.
   (c) On or before September 1 of each year, the head of each state
agency shall submit to the Legislature a report on the number and
dollar volume of written complaints received from subcontractors and
prime contractors on contracts in excess of three hundred thousand
dollars ($300,000), relating to violations of this section.
  SEC. 192.  Section 10344 of the Public Contract Code is amended to
read:
   10344.  (a) Contracts subject to the provisions of this article
may be awarded under a procedure that makes use of a request for
proposal. State agencies that use this procedure shall include in the
request for proposal a clear, precise description of the work to be
performed or services to be provided, a description of the format
that proposals shall follow and the elements they shall contain, the
standards the agency will use in evaluating proposals, the date on
which proposals are due, and the timetable the agency will follow in
reviewing and evaluating them.
   State agencies that use a procedure that makes use of a request
for proposal shall evaluate proposals and award contracts in
accordance with the provisions of subdivision (b) or (c). No
proposals shall be considered that have not been received at the
place, and prior to the closing time, stated in the request for
proposal.
   (b) State agencies that use the evaluation and selection procedure
in this subdivision shall include in the request for proposal, in
addition to the information required by subdivision (a), a
requirement that bidders submit their proposals with the bid price
and all cost information in a separate, sealed envelope.
   Proposals shall be evaluated and the contract awarded in the
following manner:
   (1) All proposals received shall be reviewed to determine those
that meet the format requirements and the standards specified in the
request for proposal.
   (2) The sealed envelopes containing the bid price and cost
information for those proposals that meet the format requirements and
standards shall then be publicly opened and read.
   (3) The contract shall be awarded to the lowest responsible bidder
meeting the standards.
   (c) State agencies that use the evaluation and selection procedure
in this subdivision shall include in the request for proposal, in
addition to the information required by subdivision (a), a
description of the methods that will be used in evaluating and
scoring the proposals. Any evaluation and scoring method shall ensure
that substantial weight in relationship to all other criteria
utilized shall be given to the contract price proposed by the bidder.

   Proposals shall be evaluated and the contract awarded in the
following manner:
   (1) All proposals shall be reviewed to determine which meet the
format requirements specified in the request for proposal.
   (2) All proposals meeting the formal requirements shall then be
submitted to an agency evaluation committee which shall evaluate and
score the proposals using the methods specified in the request for
proposal. All proposals and all evaluation and scoring sheets shall
be available for public inspection at the conclusion of the committee
scoring process.
   (3) The contract shall be awarded to the bidder whose proposal is
given the highest score by the evaluation committee.
   (d) Nothing in this section shall require the awarding of the
contract if no proposals are received containing bids offering a
contract price that in the opinion of the state agency is a
reasonable price.
   (e) (1) In addition to the information required by subdivision
(a), a request for proposal for a contract that involves the
furnishing of equipment, materials, or supplies shall contain the
following statement:
   "It is unlawful for any person engaged in business within this
state to sell or use any article or product as a "loss leader" as
defined in Section 17030 of the Business and Professions Code."
   (2) On and after March 31, 2010, and until December 31, 2011, if a
request for proposal does not contain the statement required by
paragraph (1), the awarding agency shall report this error to the
department within 30 days of the date the awarding agency discovers
this error.
   (3) The department shall post in the State Contracting Manual
instructions for including the statement required by paragraph (1) in
all affected contracts.
   (4) The statement required by paragraph (1) shall be deemed to be
part of a request for proposal even if the statement is inadvertently
omitted from the request for proposal.
  SEC. 193.  Section 2621.7 of the Public Resources Code is amended
to read:
   2621.7.  This chapter, except Section 2621.9, shall not apply to
any of the following:
   (a) The conversion of an existing apartment complex into a
condominium.
   (b) Any development or structure in existence prior to May 4,
1975, except for an alteration or addition to a structure that
exceeds the value limit specified in subdivision (c).
   (c) An alteration or addition to any structure if the value of the
alteration or addition does not exceed 50 percent of the value of
the structure.
   (d) (1) Any structure located within the jurisdiction of the City
of Berkeley or the City of Oakland which was damaged by fire between
October 20, 1991, and October 23, 1991, if granted an exemption
pursuant to this subdivision.
   (2) The city may apply to the State Geologist for an exemption and
the State Geologist shall grant the exemption only if the structure
located within the earthquake fault zone is not situated upon a trace
of an active fault line, as delineated in the official earthquake
fault zone map or in more recent geologic data, as determined by the
State Geologist.
   (3) When requesting an exemption, the city shall submit to the
State Geologist all of the following information:
   (A) Maps noting the parcel numbers of proposed building sites that
are at least 50 feet from an identified fault and a statement that
there is not any more recent information to indicate a geologic
hazard.
   (B) Identification of any sites that are within 50 feet of an
identified fault.
   (C) Proof that the property owner has been notified that the
granting of an exemption is not any guarantee that a geologic hazard
does not exist.
   (4) The granting of the exemption does not relieve a seller of
real property or an agent for the seller of the obligation to
disclose to a prospective purchaser that the property is located
within a delineated earthquake fault zone, as required by Section
2621.9.
   (e) (1) Alterations which include seismic retrofitting, as defined
in Section 8894.2 of the Government Code, to any of the following
buildings in existence prior to May 4, 1975:
   (A) Unreinforced masonry buildings, as described in subdivision
(a) of Section 8875 of the Government Code.
   (B) Concrete tilt-up buildings, as described in Section 8893 of
the Government Code.
   (C) Reinforced concrete moment resisting frame buildings as
described in Applied Technology Council Report 21 (FEMA Report 154).
   (D) Any structure owned and operated by a state entity or agency
that is listed on the California Register of Historical Resources or
the National Register of Historic Places, including the California
Memorial Stadium. This exemption shall not apply unless the state
entity or agency submits a plan of proposed alterations to the State
Geologist. The addition of this subparagraph does not modify, alter,
conflict with, or supersede the intent or applicability of any other
provisions of this chapter.
   (2) The exemption granted by subparagraphs (A), (B), and (C) of
paragraph (1) shall not apply unless a city or county acts in
accordance with all of the following:
   (A) The building permit issued by the city or county for the
alterations authorizes no greater human occupancy load, regardless of
proposed use, than that authorized for the existing use permitted at
the time the city or county grants the exemption. This may be
accomplished by the city or county making a human occupancy load
determination that is based on, and no greater than, the existing
authorized use, and including that determination on the building
permit application as well as a statement substantially as follows:
"Under subparagraph (A) of paragraph (2) of subdivision (e) of
Section 2621.7 of the Public Resources Code, the occupancy load is
limited to the occupancy load for the last lawful use authorized or
existing prior to the issuance of this building permit, as determined
by the city or county."
   (B) The city or county requires seismic retrofitting, as defined
in Section 8894.2 of the Government Code, which is necessary to
strengthen the entire structure and provide increased resistance to
ground shaking from earthquakes.
   (C) Exemptions granted pursuant to paragraph (1) are reported in
writing to the State Geologist within 30 days of the building permit
issuance date.
   (3) Any structure with human occupancy restrictions under
subparagraph (A) of paragraph (2) shall not be granted a new building
permit that allows an increase in human occupancy unless a geologic
report, prepared pursuant to subdivision (d) of Section 3603 of Title
14 of the California Code of Regulations in effect on January 1,
1994, demonstrates that the structure is not on the trace of an
active fault, or the requirement of a geologic report has been waived
pursuant to Section 2623.
   (4) A qualified historical building within an earthquake fault
zone that is exempt pursuant to this subdivision may be repaired or
seismically retrofitted using the State Historical Building Code,
except that, notwithstanding any provision of that building code and
its implementing regulations, paragraph (2) shall apply.
  SEC. 194.  Section 4590 of the Public Resources Code, as amended by
Section 1 of Chapter 269 of the Statutes of 2009, is amended to
read:
   4590.  (a) (1) A timber harvesting plan is effective for a period
of not more than three years, unless extended pursuant to paragraph
(2).
   (2) A timber harvesting plan, on which timber operations have
commenced but not been completed, may be extended by amendment for a
one-year period in order to complete the timber operations, up to a
maximum of two 1-year extensions, if both of the following occur:
   (A) Good cause is shown.
   (B) All timber operations are in conformance with the plan, this
chapter, and all applicable rules and regulations, upon the filing of
the notice of extension as required by this section.
   (b) The extension shall apply to any area covered by the plan for
which a report has not been submitted under Section 4585. The notice
of extension shall be provided to the department not sooner than 30
days, but at least 10 days, prior to the expiration date of the plan.
The notice shall include the circumstances that prevented a timely
completion of the timber operations under the plan, written
certification by a registered professional forester that neither of
the conditions in subdivision (f) have occurred, and, consistent with
Section 4583, an agreement to comply with this chapter and the rules
and regulations of the board as they exist on the date the extension
notice is filed.
   (c) Stocking work may continue for more than the effective period
of the plan under subdivision (a), but shall be completed within five
years after the conclusion of other work.
   (d) Notwithstanding subdivision (a) and the submission of a
completion report pursuant to Section 4585, a timber harvesting plan,
on which timber operations have commenced but not been completed,
may be reopened and extended by amendment for up to a maximum of four
1-year extensions if the following conditions have been met:
   (1) The plan expired in 2008 or 2009.
   (2) The plan complies with subparagraphs (A) and (B) of paragraph
(2) of subdivision (a).
   (3) The notice of extension, pursuant to subdivision (b), includes
written certification by a registered professional forester that
neither of the conditions in subdivision (f) has occurred.
   (e) A timber harvesting plan that is approved on or after January
1, 2010, to December 31, 2011, inclusive, may be extended by
amendment for a two-year period in order to complete the timber
operations, up to a maximum of two 2-year extensions, if the plan
complies with subparagraphs (A) and (B) of paragraph (2) of
subdivision (a) and the notice of extension, pursuant to subdivision
(b), includes written certification by a registered professional
forester that neither of the conditions in subdivision (f) has
occurred.
   (f) The department shall not approve an extension pursuant to
subdivision (e) if either of the following has occurred:
   (1) Listed species, as described in Article 1 (commencing with
Section 2050) of Chapter 1.5 of Division 3 of the Fish and Game Code
or the federal Endangered Species Act (16 U.S.C. Sec. 1531 et seq.),
have been discovered in the logging area of the plan since approval
of the timber harvesting plan.
   (2) Significant physical changes to the harvest area or adjacent
areas have occurred since the timber harvesting plan's cumulative
impacts were originally assessed.
   (g) An extension of a timber harvesting plan on which either of
the conditions in subdivision (f) has occurred may be obtained only
pursuant to Section 1039 of Title 14 of the California Code of
Regulations. Notwithstanding the notice provision of subdivision (b),
for purposes of this subdivision the notice of extension shall be
provided to the department not sooner than 140 days, but at least 10
days, prior to the expiration date of the plan.
   (h) This section shall remain in effect only until January 1,
2012, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2012, deletes or extends
that date.
  SEC. 195.  Section 5842 of the Public Resources Code is amended to
read:
   5842.  (a) The Legislature hereby adopts the American River
Parkway Plan so as to provide coordination with local agencies in the
protection and management of the diverse and valuable natural land,
water, native wildlife, and vegetation of the American River Parkway.

   (b) Actions of state and local agencies with regard to land use
decisions shall be consistent with the American River Parkway Plan,
subject to the following provisions:
   (1) This chapter does not impair the authority and
responsibilities of state or local public agencies in maintaining and
operating the flood channel, levees, and pump stations, except that
these operations, as nearly as practicable, shall be consistent with
the American River Parkway Plan.
   (2) This chapter does not affect the existing authority of the
City of Sacramento to conduct or settle litigation involving the
validity or application of the American River Parkway Plan.
   (3) This chapter does not prohibit the reasonable expansion of the
water treatment facility operated by the City of Sacramento.
   (4) This chapter does not impair the authority and
responsibilities of state agencies in managing the California
Exposition flood plain or Bushy Lake area pursuant to Chapter 9
(commencing with Section 5830).
   (5) This chapter does not affect the exercise of existing water
rights.
   (c) Notwithstanding subdivision (a), the Legislature finds and
declares that Chapter 10 of the American River Parkway Plan, titled
Area Plans, which consists of maps, policies, and narrative, may be
amended through a local amendment process. However, Area Plans may be
amended only to the extent that they are not inconsistent with the
state-adopted Area Plan policies contained in Chapter 2 of the
American River Parkway Plan. The Legislature recognizes that
amendments to Area Plans shall be carried out by the Sacramento
County Board of Supervisors in accordance with the public hearing
process described in Chapter 11 of the American River Parkway Plan,
titled Implementation, and recognizes the roles and responsibilities
of public agencies set forth in the public hearing process including
coordination with the city councils of the Cities of Sacramento and
Rancho Cordova.
  SEC. 196.  Section 25402.10 of the Public Resources Code is amended
to read:
   25402.10.  (a) On and after January 1, 2009, electric and gas
utilities shall maintain records of the energy consumption data of
all nonresidential buildings to which they provide service. This data
shall be maintained, in a format compatible for uploading to the
United States Environmental Protection Agency's ENERGY STAR Portfolio
Manager, for at least the most recent 12 months.
   (b) On and after January 1, 2009, upon the written authorization
or secure electronic authorization of a nonresidential building owner
or operator, an electric or gas utility shall upload all of the
energy consumption data for the account specified for a building to
the United States Environmental Protection Agency's ENERGY STAR
Portfolio Manager in a manner that preserves the confidentiality of
the customer.
   (c) In carrying out this section, an electric or gas utility may
use any method for providing the specified data in order to maximize
efficiency and minimize overall program cost, and is encouraged to
work with the United States Environmental Protection Agency and
customers in developing reasonable reporting options.
   (d) (1) Based on a schedule developed by the commission pursuant
to paragraph (2), an owner or operator of a nonresidential building
shall disclose the United States Environmental Protection Agency's
ENERGY STAR Portfolio Manager benchmarking data and ratings for the
most recent 12-month period to a prospective buyer, lessee of the
entire building, or lender that would finance the entire building. If
the data is delivered to a prospective buyer, lessee, or lender, a
property owner, operator, or his or her agent is not required to
provide additional information, and the information shall be deemed
to be adequate to inform the prospective buyer, lessee, or lender
regarding the United States Environmental Protection Agency's ENERGY
STAR Portfolio Manager benchmarking data and ratings for the most
recent 12-month period for the building that is being sold, leased,
financed, or refinanced.
   (2) The commission shall establish a schedule by which an owner or
operator is required to meet the requirements of this subdivision.
   (e) Notwithstanding subdivision (d), this section does not
increase or decrease the duties, if any, of a property owner,
operator, or his or her broker or agent under this chapter or alter
the duty of a seller, agent, or broker to disclose the existence of a
material fact affecting the real property.
  SEC. 197.  Section 48010 of the Public Resources Code is amended to
read:
   48010.  (a) (1) An operator of a landfill that is operating the
landfill on July 1, 2011, and that elects to participate in the State
Solid Waste Postclosure and Corrective Action Trust Fund pursuant to
this article, shall submit written notice to the board on or before
July 1, 2011.
   (2) An operator of multiple landfills that elects to participate
in the State Solid Waste Postclosure and Corrective Action Trust Fund
is required to                                          submit
written notice that includes all of the operator's operating
landfills and all other landfills in which that operator has in
common ownership.
   (3) The board shall provide to the state board the name and
address, and any other information necessary to administer and
collect the fee imposed pursuant to subdivision (b) of Section 48000,
of every operator of a landfill electing to participate in the State
Solid Waste Postclosure and Corrective Action Trust Fund on or
before August 31, 2011.
   (b) If an operator that is operating a landfill on July 1, 2011,
submits a written notification to the board that it elects to
participate after the trust fund fee goes into effect, the operator
shall pay all trust fund fees applicable from January 1, 2012, and a
5-percent penalty before being allowed to participate.
   (c) For new landfills that receive a solid waste facility permit
after July 1, 2011, the operator's election to participate in the
State Solid Waste Postclosure and Corrective Action Trust Fund shall
be submitted in writing to the board before the board concurs in the
issuance of the permit pursuant to Section 44009.
   (d) All elections to participate made by landfill operators
pursuant to this section are final, binding, and irrevocable for
those operators and their successors and assignees.
  SEC. 198.  Section 48027 of the Public Resources Code is amended to
read:
   48027.  (a) (1) The Legislature hereby finds and declares that
effective response to cleanup at solid waste disposal and codisposal
sites requires that the state have sufficient funds available in the
trust fund created pursuant to subdivision (b).
   (2) The Legislature further finds and declares that the
maintenance of the trust fund is of the utmost importance to the
state and that it is essential that, except as described in
subdivision (g), any moneys in the trust fund be used solely for the
purposes authorized in this article and not be used, loaned, or
transferred for any other purpose.
   (b) The Solid Waste Disposal Site Cleanup Trust Fund is hereby
created in the State Treasury. Notwithstanding Section 13340 of the
Government Code, the moneys in the trust fund are hereby continuously
appropriated to the board for expenditure, without regard to fiscal
years, for the purposes of this article.
   (c) The following moneys shall be deposited into the trust fund:
   (1) Funds appropriated by the Legislature from the Integrated
Waste Management Account to the board for solid waste disposal or
codisposal site cleanup.
   (2) Any interest earned on the moneys in the trust fund.
   (3) Any cost recoveries from responsible parties for solid waste
disposal or codisposal site cleanup and loan repayments pursuant to
this article.
   (d) If this article is repealed, the trust fund shall be dissolved
and all moneys in the fund shall be distributed to solid waste
landfill operators who have paid into the trust fund during the
effective life of the trust fund.
   (e) Any trust fund distributions received by solid waste landfill
operators pursuant to subdivision (c) may be used for only any of the
following activities, as related to solid waste landfills:
   (1) Solid waste landfill closure and postclosure maintenance
operations.
   (2) Implementation of Part 258 (commencing with Section 258.1) of
Chapter I of Title 40 of the Code of Federal Regulations.
   (3) Corrective actions at the solid waste landfill.
   (f) The balance in the trust fund each July 1 shall not exceed
thirty million dollars ($30,000,000).
   (g) Notwithstanding any other law, the Controller may use the
moneys in the Solid Waste Disposal Site Cleanup Trust Fund for loans
to the General Fund as provided in Sections 16310 and 16381 of the
Government Code.
  SEC. 199.  Section 281 of the Public Utilities Code is amended to
read:
   281.  (a) The commission shall develop, implement, and administer
the California Advanced Services Fund to encourage deployment of
high-quality advanced communications services to all Californians
that will promote economic growth, job creation, and the substantial
social benefits of advanced information and communications
technologies, as provided in Decision 07-12-054.
   (b) (1) All moneys collected by the surcharge authorized by the
commission pursuant to that decision, whether collected before or
after January 1, 2009, shall be transmitted to the commission
pursuant to a schedule established by the commission. The commission
shall transfer the moneys received to the Controller for deposit in
the California Advanced Services Fund.
   (2) All interest earned on moneys in the fund shall be deposited
in the fund.
   (3) The commission may not collect moneys, by imposing the
surcharge described in paragraph (1) for deposit in the fund, in an
amount that exceeds a total amount of one hundred million dollars
($100,000,000).
   (c) (1) Any moneys appropriated from the California Advanced
Services Fund to the commission may only be expended for the program
administered by the commission pursuant to subdivision (a), including
the costs incurred by the commission in developing, implementing,
and administering the program and the fund.
   (2) Notwithstanding any other law and for the sole purpose of
providing matching funds pursuant to the federal American Recovery
and Reinvestment Act of 2009 (P.L. 111-5), any entity eligible for
funding pursuant to that act shall be eligible to apply to
participate in the program administered by the commission pursuant to
subdivision (a), if that entity otherwise satisfies the eligibility
requirements under that program. Nothing in this section shall impede
the ability of an incumbent local exchange carrier, as defined by
subsection (h) of Section 251 of Title 47 of the United States Code,
that is regulated under a rate-of-return regulatory structure, to
recover, in rate base, California infrastructure investment not
provided through federal or state grant funds for facilities that
provide broadband service and California intrastate voice service.
   (d) The commission shall conduct both a financial audit and a
performance audit of the implementation and effectiveness of the
California Advanced Services Fund to ensure that funds have been
expended in accordance with the approved terms of the winning bids
and this section. The commission shall report its findings to the
Legislature by December 31, 2010. The report shall also include an
update to the maps in the final report of the California Broadband
Task Force.
   (e) This section shall remain in effect only until January 1,
2013, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2013, deletes or extends
that date.
  SEC. 200.  Section 399.20 of the Public Utilities Code is amended
to read:
   399.20.  (a) It is the policy of this state and the intent of the
Legislature to encourage electrical generation from eligible
renewable energy resources.
   (b) As used in this section, "electric generation facility" means
an electric generation facility located within the service territory
of, and developed to sell electricity to, an electrical corporation
that meets all of the following criteria:
   (1) Has an effective capacity of not more than three megawatts.
   (2) Is interconnected and operates in parallel with the electrical
transmission and distribution grid.
   (3) Is strategically located and interconnected to the electrical
transmission and distribution grid in a manner that optimizes the
deliverability of electricity generated at the facility to load
centers.
   (4) Is an eligible renewable energy resource.
   (c) Every electrical corporation shall file with the commission a
standard tariff for electricity purchased from an electric generation
facility. The commission may modify or adjust the requirements of
this section for any electrical corporation with less than 100,000
service connections, as individual circumstances merit.
   (d) (1) The tariff shall provide for payment for every
kilowatthour of electricity purchased from an electric generation
facility for a period of 10, 15, or 20 years, as authorized by the
commission. The payment shall be the market price determined by the
commission pursuant to Section 399.15 and shall include all current
and anticipated environmental compliance costs, including, but not
limited to, mitigation of emissions of greenhouse gases and air
pollution offsets associated with the operation of new generating
facilities in the local air pollution control or air quality
management district where the electric generation facility is
located.
   (2) The commission may adjust the payment rate to reflect the
value of every kilowatthour of electricity generated on a
time-of-delivery basis.
   (3) The commission shall ensure, with respect to rates and
charges, that ratepayers that do not receive service pursuant to the
tariff are indifferent to whether a ratepayer with an electric
generation facility receives service pursuant to the tariff.
   (e) An electrical corporation shall provide expedited
interconnection procedures to an electric generation facility located
on a distribution circuit that generates electricity at a time and
in a manner so as to offset the peak demand on the distribution
circuit, if the electrical corporation determines that the electric
generation facility will not adversely affect the distribution grid.
The commission shall consider and may establish a value for an
electric generation facility located on a distribution circuit that
generates electricity at a time and in a manner so as to offset the
peak demand on the distribution circuit.
   (f) An electrical corporation shall make the tariff available to
the owner or operator of an electric generation facility within the
service territory of the electrical corporation, upon request, on a
first-come-first-served basis, until the electrical corporation meets
its proportionate share of a statewide cap of 750 megawatts
cumulative rated generation capacity served under this section and
Section 387.6. The proportionate share shall be calculated based on
the ratio of the electrical corporation's peak demand compared to the
total statewide peak demand.
   (g) The electrical corporation may make the terms of the tariff
available to owners and operators of an electric generation facility
in the form of a standard contract subject to commission approval.
   (h) Every kilowatthour of electricity purchased from an electric
generation facility shall count toward meeting the electrical
corporation's renewables portfolio standard annual procurement
targets for purposes of paragraph (1) of subdivision (b) of Section
399.15.
   (i) The physical generating capacity of an electric generation
facility shall count toward the electrical corporation's resource
adequacy requirement for purposes of Section 380.
   (j) (1) The commission shall establish performance standards for
any electric generation facility that has a capacity greater than one
megawatt to ensure that those facilities are constructed, operated,
and maintained to generate the expected annual net production of
electricity and do not impact system reliability.
   (2) The commission may reduce the three megawatt capacity
limitation of paragraph (1) of subdivision (b) if the commission
finds that a reduced capacity limitation is necessary to maintain
system reliability within that electrical corporation's service
territory.
   (k) (1) Any owner or operator of an electric generation facility
that received ratepayer-funded incentives in accordance with Section
379.6 of this code, or with Section 25782 of the Public Resources
Code, and participated in a net metering program pursuant to Sections
2827, 2827.9, and 2827.10 of this code prior to January 1, 2010,
shall be eligible for a tariff or standard contract filed by an
electrical corporation pursuant to this section.
   (2) In establishing the tariffs or standard contracts pursuant to
this section, the commission shall consider ratepayer-funded
incentive payments previously received by the generation facility
pursuant to Section 379.6 of this code or Section 25782 of the Public
Resources Code. The commission shall require reimbursement of any
funds received from these incentive programs to an electric
generation facility, in order for that facility to be eligible for a
tariff or standard contract filed by an electrical corporation
pursuant to this section, unless the commission determines ratepayers
have received sufficient value from the incentives provided to the
facility based on how long the project has been in operation and the
amount of renewable electricity previously generated by the facility.

   (3) A customer that receives service under a tariff or contract
approved by the commission pursuant to this section is not eligible
to participate in any net metering program.
   (l) An owner or operator of an electric generation facility
electing to receive service under a tariff or contract approved by
the commission shall continue to receive service under the tariff or
contract until either of the following occurs:
   (1) The owner or operator of an electric generation facility no
longer meets the eligibility requirements for receiving service
pursuant to the tariff or contract.
   (2) The period of service established by the commission pursuant
to subdivision (d) is completed.
   (m) Within 10 days of receipt of a request for a tariff pursuant
to this section from an owner or operator of an electric generation
facility, the electrical corporation that receives the request shall
post a copy of the request on its Internet Web site. The information
posted on the Internet Web site shall include the name of the city in
which the facility is located, but information that is proprietary
and confidential, including, but not limited to, address information
beyond the name of the city in which the facility is located, shall
be redacted.
   (n) An electrical corporation may deny a tariff request pursuant
to this section if the electrical corporation makes any of the
following findings:
   (1) The electric generation facility does not meet the
requirements of this section.
   (2) The transmission or distribution grid that would serve as the
point of interconnection is inadequate.
   (3) The electric generation facility does not meet all applicable
state and local laws and building standards, and utility
interconnection requirements.
   (4) The aggregate of all electric generating facilities on a
distribution circuit would adversely impact utility operation and
load restoration efforts of the distribution system.
   (o) Upon receiving a notice of denial from an electrical
corporation, the owner or operator of the electric generation
facility denied a tariff pursuant to this section shall have the
right to appeal that decision to the commission.
   (p) In order to ensure the safety and reliability of electric
generation facilities, the owner of an electric generation facility
receiving a tariff pursuant to this section shall provide an
inspection and maintenance report to the electrical corporation at
least once every other year. The inspection and maintenance report
shall be prepared at the owner's or operator's expense by a
California-licensed contractor who is not the owner or operator of
the electric generation facility. A California-licensed electrician
shall perform the inspection of the electrical portion of the
generation facility.
   (q) The contract between the electric generation facility
receiving the tariff and the electrical corporation shall contain
provisions that ensure that construction of the electric generating
facility complies with all applicable state and local laws and
building standards, and utility interconnection requirements.
   (r) (1) All construction and installation of facilities of the
electrical corporation, including at the point of the output meter or
at the transmission or distribution grid, shall be performed only by
that electrical corporation.
   (2) All interconnection facilities installed on the electrical
corporation's side of the transfer point for electricity between the
electrical corporation and the electrical conductors of the electric
generation facility shall be owned, operated, and maintained only by
the electrical corporation. The ownership, installation, operation,
reading, and testing of revenue metering equipment for electric
generating facilities shall only be performed by the electrical
corporation.
  SEC. 201.  Section 777.1 of the Public Utilities Code is amended to
read:
   777.1.  (a) If an electrical, gas, heat, or water corporation
furnishes residential service to residential occupants through a
master meter in a multiunit residential structure, mobilehome park,
or permanent residential structure in a labor camp, as defined in
Section 17008 of the Health and Safety Code, and the owner, manager,
or operator of the structure or park is listed by the corporation as
the customer of record, the corporation shall make every good faith
effort to inform the residential occupants, by means of a written
notice posted on the door of each residential unit at least 15 days
prior to termination, when the account is in arrears, that service
will be terminated on a date specified in the notice. If it is not
reasonable or practicable to post the notice on the door of each
residential unit, the corporation shall post two copies of the notice
in each accessible common area and at each point of access to the
structure or structures. The notice shall further inform the
residential occupants that they have the right to become customers,
to whom the service will then be billed, without being required to
pay any amount which may be due on the delinquent account. The notice
also shall specify, in plain language, what the residential
occupants are required to do in order to prevent the termination of,
or to reestablish service; the estimated monthly cost of service; the
title, address, and telephone number of a representative of the
corporation who can assist the residential occupants in continuing
service; and the address and telephone number of a qualified legal
services project, as defined in Section 6213 of the Business and
Professions Code, which has been recommended by the local county bar
association. The notice shall be in English and the languages listed
in Section 1632 of the Civil Code.
   (b) The corporation is not required to make service available to
the residential occupants unless each residential occupant or a
representative of the residential occupants agrees to the terms and
conditions of service and meets the requirements of law and the
corporation's rules and tariffs. However, if one or more of the
residential occupants or the representative of the residential
occupants are willing and able to assume responsibility for
subsequent charges to the account to the satisfaction of the
corporation, or if there is a physical means, legally available to
the corporation, of selectively terminating service to those
residential occupants who have not met the requirements of the
corporation's rules and tariffs or for whom the representative of the
residential occupants is not responsible, the corporation shall make
service available to those residential occupants who have met those
requirements or on whose behalf those requirements have been met.
   (c) If prior service for a period of time or other demonstration
of credit worthiness is a condition for establishing credit with the
corporation, residence and proof of prompt payment of rent or other
credit obligation during that period of time acceptable to the
corporation is a satisfactory equivalent.
   (d) Any residential occupant who becomes a customer of the
corporation pursuant to this section whose periodic payments, such as
rental payments, include charges for residential electrical, gas,
heat, or water service, where those charges are not separately
stated, may deduct from the periodic payment each payment period all
reasonable charges paid to the corporation for those services during
the preceding payment period.
   (e) If a corporation furnishes residential service subject to
subdivision (a), the corporation shall not terminate that service in
any of the following situations:
   (1) During the pendency of an investigation by the corporation of
a customer dispute or complaint.
   (2) If the customer has been granted an extension of the period
for payment of a bill.
   (3) For an indebtedness owed by the customer to any other person
or corporation or if the obligation represented by the delinquent
account or other indebtedness was incurred with a person or
corporation other than the electrical, gas, heat, or water
corporation demanding payment therefor.
   (4) If a delinquent account relates to another property owned,
managed, or operated by the customer.
   (5) If a public health or building officer certifies that
termination would result in a significant threat to the health or
safety of the residential occupants or the public.
   (f) Notwithstanding any other provision of law, and in addition to
any other remedy provided by law, if the owner, manager, or
operator, by any act or omission, directs, permits, or fails to
prevent a termination of service while any residential unit receiving
that service is occupied, the residential occupant or the
representative of the residential occupants may commence an action
for the recovery of all of the following:
   (1) Reasonable costs and expenses incurred by the residential
occupant or the representative of the residential occupants related
to restoration of service.
   (2) Actual damages related to the termination of service.
   (3) Reasonable attorney's fees of the residential occupants, the
representative of the residential occupants, or each of them,
incurred in the enforcement of this section, including, but not
limited to, enforcement of a lien.
   (g) Notwithstanding any other provision of law, and in addition to
any other remedy provided by law, if the owner, manager, or
operator, by any act or omission, directs, permits, or fails to
prevent a termination of service while any residential unit receiving
that service is occupied, the corporation may commence an action for
the recovery of all of the following:
   (1) Delinquent charges accruing prior to the expiration of the
notice prescribed by subdivision (a).
   (2) Reasonable costs incurred by the corporation related to the
restoration of service.
   (3) Reasonable attorney's fees of the corporation incurred in the
enforcement of this section or in the collection of delinquent
charges, including, but not limited to, enforcement of a lien.
   If the court finds that the owner, manager, or operator has paid
the amount in arrears prior to termination, the court shall allow no
recovery of any charges, costs, damages, expenses, or fees under this
subdivision from the owner, manager, or operator.
   An abstract of any money judgment entered pursuant to subdivision
(f) or (g) of this section shall be recorded pursuant to Section
697.310 of the Code of Civil Procedure.
   (h) No termination of service subject to this section may be
effected without compliance with this section, and any service
wrongfully terminated shall be restored without charge to the
residential occupants or customer for the restoration of the service.
In the event of a wrongful termination by the corporation, the
corporation shall, in addition, be liable to the residential
occupants or customer for actual damages resulting from the
termination and for the costs of enforcement of this section,
including, but not limited to, reasonable attorney's fees, if the
residential occupants or the representative of the residential
occupants made a good faith effort to have the service continued
without interruption.
   (i) The commission shall adopt rules and orders necessary to
implement this section and shall liberally construe this section to
accomplish its purpose of ensuring that service to residential
occupants is not terminated due to nonpayment by the customer unless
the corporation has made every reasonable effort to continue service
to the residential occupants. The rules and orders shall include, but
are not limited to, reasonable penalties for a violation of this
section, guidelines for assistance to residents in the enforcement of
this section, and requirements for the notice prescribed by
subdivision (a), including, but not limited to, clear wording, large
and boldface type, and comprehensive instructions to ensure full
notice to the resident.
   (j) Nothing in this section broadens or restricts any authority of
a local agency that existed prior to January 1, 1989, to adopt an
ordinance protecting a residential occupant from the involuntary
termination of residential public utility service.
   (k) This section preempts any statute or ordinance permitting
punitive damages against any owner, manager, or operator on account
of an involuntary termination of residential public utility service
or permitting the recovery of costs associated with the formation,
maintenance, and termination of a tenants' association.
   (l) For purposes of this section, "representative of the
residential occupants" does not include a tenants' association.
  SEC. 202.  Section 851 of the Public Utilities Code is amended to
read:
   851.  A public utility, other than a common carrier by railroad
subject to Part A of the Interstate Commerce Act (49 U.S.C. Sec.
10101 et seq.), shall not sell, lease, assign, mortgage, or otherwise
dispose of, or encumber the whole or any part of its railroad,
street railroad, line, plant, system, or other property necessary or
useful in the performance of its duties to the public, or any
franchise or permit or any right thereunder, or by any means
whatsoever, directly or indirectly, merge or consolidate its
railroad, street railroad, line, plant, system, or other property, or
franchises or permits or any part thereof, with any other public
utility, without first having either secured an order from the
commission authorizing it to do so for qualified transactions valued
above five million dollars ($5,000,000), or for qualified
transactions valued at five million dollars ($5,000,000) or less,
filed an advice letter and obtained approval from the commission
authorizing it to do so. If the advice letter is uncontested,
approval may be given by the executive director or the director of
the division of the commission having regulatory jurisdiction over
the utility. The commission shall determine the types of transactions
valued at five million dollars ($5,000,000) or less, that qualify
for advice letter handling. For a qualified transaction valued at
five million dollars ($5,000,000) or less, the commission may
designate a procedure different
    than the advice letter procedure if it determines that the
transaction warrants a more comprehensive review. Absent protest or
incomplete documentation, the commission shall approve or deny the
advice letter within 120 days of its filing by the applicant public
utility. The commission shall reject any advice letter that seeks to
circumvent the five million dollar ($5,000,000) threshold by dividing
a single asset with a value of more than five million dollars
($5,000,000), into component parts, each valued at less than five
million dollars ($5,000,000). Every sale, lease, assignment,
mortgage, disposition, encumbrance, merger, or consolidation made
other than in accordance with the advice letter and approval from the
commission authorizing it is void. The permission and approval of
the commission to the exercise of a franchise or permit under Article
1 (commencing with Section 1001) of Chapter 5, or the sale, lease,
assignment, mortgage, or other disposition or encumbrance of a
franchise or permit under this article shall not revive or validate
any lapsed or invalid franchise or permit, or enlarge or add to the
powers or privileges contained in the grant of any franchise or
permit, or waive any forfeiture.
   This section does not prevent the sale, lease, encumbrance, or
other disposition by any public utility of property that is not
necessary or useful in the performance of its duties to the public,
and any disposition of property by a public utility shall be
conclusively presumed to be of property that is not useful or
necessary in the performance of its duties to the public, as to any
purchaser, lessee, or encumbrancer dealing with that property in good
faith for value, provided that this section does not apply to the
interchange of equipment in the regular course of transportation
between connecting common carriers.
  SEC. 203.  Section 2881 of the Public Utilities Code is amended to
read:
   2881.  (a) The commission shall design and implement a program to
provide a telecommunications device capable of serving the needs of
individuals who are deaf or hearing impaired, together with a single
party line, at no charge additional to the basic exchange rate, to
any subscriber who is certified as an individual who is deaf or
hearing impaired by a licensed physician and surgeon, audiologist, or
a qualified state or federal agency, as determined by the
commission, and to any subscriber that is an organization
representing individuals who are deaf or hearing impaired, as
determined and specified by the commission pursuant to subdivision
(e). A licensed hearing aid dispenser may certify the need of an
individual to participate in the program if that individual has been
previously fitted with an amplified device by the dispenser and the
dispenser has the individual's hearing records on file prior to
certification.
   (b) The commission shall also design and implement a program to
provide a dual-party relay system, using third-party intervention to
connect individuals who are deaf or hearing impaired and offices of
organizations representing individuals who are deaf or hearing
impaired, as determined and specified by the commission pursuant to
subdivision (e), with persons of normal hearing by way of
intercommunications devices for individuals who are deaf or hearing
impaired and the telephone system, making available reasonable access
of all phases of public telephone service to telephone subscribers
who are deaf or hearing impaired. In order to make a dual-party relay
system that will meet the requirements of individuals who are deaf
or hearing impaired available at a reasonable cost, the commission
shall initiate an investigation, conduct public hearings to determine
the most cost-effective method of providing dual-party relay service
to the deaf or hearing impaired when using a telecommunications
device, and solicit the advice, counsel, and physical assistance of
statewide nonprofit consumer organizations of the deaf, during the
development and implementation of the system. The commission shall
phase in this program, on a geographical basis, over a three-year
period ending on January 1, 1987. The commission shall apply for
certification of this program under rules adopted by the Federal
Communications Commission pursuant to Section 401 of the federal
Americans with Disabilities Act of 1990 (P.L. 101-336).
   (c) The commission shall also design and implement a program
whereby specialized or supplemental telephone communications
equipment may be provided to subscribers who are certified to be
disabled at no charge additional to the basic exchange rate. The
certification, including a statement of visual or medical need for
specialized telecommunications equipment, shall be provided by a
licensed optometrist or physician and surgeon, acting within the
scope of practice of his or her license, or by a qualified state or
federal agency as determined by the commission. The commission shall,
in this connection, study the feasibility of, and implement, if
determined to be feasible, personal income criteria, in addition to
the certification of disability, for determining a subscriber's
eligibility under this subdivision.
   (d) The commission shall establish a rate recovery mechanism
through a surcharge not to exceed one-half of 1 percent uniformly
applied to a subscriber's intrastate telephone service, other than
one-way radio paging service and universal telephone service, both
within a service area and between service areas, to allow providers
of the equipment and service specified in subdivisions (a), (b), and
(c) to recover costs as they are incurred under this section. The
surcharge shall be in effect until January 1, 2014. The commission
shall require that the programs implemented under this section be
identified on subscribers' bills and shall establish a fund and
require separate accounting for each of the programs implemented
under this section.
   (e) The commission shall determine and specify those statewide
organizations representing the deaf or hearing impaired that shall
receive a telecommunications device pursuant to subdivision (a) or a
dual-party relay system pursuant to subdivision (b), or both, and in
which offices the equipment shall be installed in the case of an
organization having more than one office.
   (f) The commission may direct any telephone corporation subject to
its jurisdiction to comply with its determinations and
specifications pursuant to this section.
   (g) The commission shall annually review the surcharge level and
the balances in the funds established pursuant to subdivision (d).
Until January 1, 2014, the commission shall be authorized to make,
within the limits set by subdivision (d), any necessary adjustments
to the surcharge to ensure that the programs supported thereby are
adequately funded and that the fund balances are not excessive. A
fund balance which is projected to exceed six months' worth of
projected expenses at the end of the fiscal year is excessive.
   (h) The commission shall prepare and submit to the Legislature, on
or before December 31 of each year, a report on the fiscal status of
the programs established and funded pursuant to this section and
Sections 2881.1 and 2881.2. The report shall include a statement of
the surcharge level established pursuant to subdivision (d) and
revenues produced by the surcharge, an accounting of program
expenses, and an evaluation of options for controlling those expenses
and increasing program efficiency, including, but not limited to,
all of the following proposals:
   (1) The establishment of a means test for persons to qualify for
program equipment or free or reduced charges for the use of
telecommunications services.
   (2) If and to the extent not prohibited under Section 401 of the
federal Americans with Disabilities Act of 1990 (P.L. 101-336), the
imposition of limits or other restrictions on maximum usage levels
for the relay service, which shall include the development of a
program to provide basic communications requirements to all relay
users at discounted rates, including discounted toll-call rates, and,
for usage in excess of those basic requirements, at rates which
recover the full costs of service.
   (3) More efficient means for obtaining and distributing equipment
to qualified subscribers.
   (4) The establishment of quality standards for increasing the
efficiency of the relay system.
   (i) In order to continue to meet the access needs of individuals
with functional limitations of hearing, vision, movement,
manipulation, speech, and interpretation of information, the
commission shall perform ongoing assessment of, and if appropriate,
expand the scope of the program to allow for additional access
capability consistent with evolving telecommunications technology.
   (j) The commission shall structure the programs required by this
section so that any charge imposed to promote the goals of universal
service reasonably equals the value of the benefits of universal
service to contributing entities and their subscribers.
  SEC. 204.  Section 5411 of the Public Utilities Code is amended to
read:
   5411.  Every charter-party carrier of passengers and every
officer, director, agent, or employee of any charter-party carrier of
passengers who violates or who fails to comply with, or who
procures, aids, or abets any violation by any charter-party carrier
of passengers of any provision of this chapter, or who fails to obey,
observe, or comply with any order, decision, rule, regulation,
direction, demand, or requirement of the commission, or of any
operating permit or certificate issued to any charter-party carrier
of passengers, or who procures, aids, or abets any charter-party
carrier of passengers in its failure to obey, observe, or comply with
any such order, decision, rule, regulation, direction, demand,
requirement, or operating permit or certificate, is guilty of a
misdemeanor and is punishable by a fine of not less than one thousand
dollars ($1,000) and not more than five thousand dollars ($5,000) or
by imprisonment in a county jail for not more than three months, or
by both that fine and imprisonment.
  SEC. 205.  Section 10009.1 of the Public Utilities Code is amended
to read:
   10009.1.  (a) If a public utility furnishes light, heat, water, or
power to residential occupants through a master meter in a multiunit
residential structure, mobilehome park, or permanent residential
structures in a labor camp, as defined in Section 17008 of the Health
and Safety Code, and the owner, manager, or operator of the
structure or park is listed by the public utility as the customer of
record, the public utility shall make every good faith effort to
inform the residential occupants, by means of a written notice posted
on the door of each residential unit at least 15 days prior to
termination, when the account is in arrears, that service will be
terminated on a date specified in the notice. If it is not reasonable
or practicable to post the notice on the door of each residential
unit, the public utility shall post two copies of the notice in each
accessible common area and at each point of access to the structure
or structures. The notice shall further inform the residential
occupants that they have the right to become utility customers, to
whom the service will then be billed, without being required to pay
the amount due on the delinquent account. The notice also shall
specify, in plain language, what the residential occupants are
required to do in order to prevent the termination of, or to
reestablish service; the estimated monthly cost of service; the
title, address, and telephone number of a representative of the
public utility who can assist the residential occupants in continuing
service; and the address and telephone number of a qualified legal
services project, as defined in Section 6213 of the Business and
Professions Code, which has been recommended by the local county bar
association. The notice shall be in English and the languages listed
in Section 1632 of the Civil Code.
   (b) The public utility is not required to make service available
to the residential occupants unless each residential occupant or a
representative of the residential occupants agrees to the terms and
conditions of service, and meets the requirements of law and the
public utility's rules. However, if one or more of the residential
occupants or the representative of the residential occupants are
willing and able to assume responsibility for subsequent charges to
the account to the satisfaction of the public utility, or if there is
a physical means, legally available to the public utility, of
selectively terminating service to those residential occupants who
have not met the requirements of the public utility's rules or for
whom the representative of the residential occupants is not
responsible, the public utility shall make service available to the
residential occupants who have met those requirements or on whose
behalf those requirements have been met.
   (c) If prior service for a period of time or other demonstration
of credit worthiness is a condition for establishing credit with the
public utility, residence and proof of prompt payment of rent or
other credit obligation during that period of time acceptable to the
public utility is a satisfactory equivalent.
   (d) Any residential occupant who becomes a customer of the public
utility pursuant to this section whose periodic payments, such as
rental payments, include charges for residential light, heat, water,
or power, where these charges are not separately stated, may deduct
from the periodic payment each payment period all reasonable charges
paid to the public utility for those services during the preceding
payment period.
   (e) If a public utility furnishes residential service subject to
subdivision (a), the public utility may not terminate that service in
any of the following situations:
   (1) During the pendency of an investigation by the public utility
of a customer dispute or complaint.
   (2) If the customer has been granted an extension of the period
for payment of a bill.
   (3) For an indebtedness owed by the customer to any other public
agency or when the obligation represented by the delinquent account
or other indebtedness was incurred with any public agency other than
the public utility.
   (4) If a delinquent account relates to another property owned,
managed, or operated by the customer.
   (5) If a public health or building officer certifies that
termination would result in a significant threat to the health or
safety of the residential occupants or the public.
   (f) Notwithstanding any other provision of law, and in addition to
any other remedy provided by law, if the owner, manager, or
operator, by any act or omission, directs, permits, or fails to
prevent a termination of service while any residential unit is
occupied, the residential occupant or the representative of the
residential occupants may commence an action for the recovery of all
of the following:
   (1) Reasonable costs and expenses incurred by the residential
occupant or the representative of the residential occupants related
to restoration of service.
   (2) Actual damages related to the termination of service.
   (3) Reasonable attorney's fees of the residential occupants, the
representative of the residential occupants, or each of them,
incurred in the enforcement of this section, including, but not
limited to, enforcement of a lien.
   (g) Notwithstanding any other provision of law, and in addition to
any other remedy provided by law, if the owner, manager, or
operator, by any act or omission, directs, permits, or fails to
prevent a termination of service while any residential unit receiving
that service is occupied, the corporation may commence an action for
the recovery of all of the following:
   (1) Delinquent charges accruing prior to the expiration of the
notice prescribed by subdivision (a).
   (2) Reasonable costs incurred by the corporation related to the
restoration of service.
   (3) Reasonable attorney's fees of the corporation incurred in the
enforcement of this section or in the collection of delinquent
charges, including, but not limited to, enforcement of a lien.
   If the court finds that the owner, manager, or operator has paid
the amount in arrears prior to termination, the court shall allow no
recovery of any charges, costs, damages, expenses, or fees under this
subdivision from the owner, manager, or operator.
   An abstract of any money judgment entered pursuant to subdivision
(f) or (g) of this section shall be recorded pursuant to Section
697.310 of the Code of Civil Procedure.
   (h) No termination of service subject to this section may be
effected without compliance with this section, and any service
wrongfully terminated shall be restored without charge to the
residential occupants or customer for the restoration of the service.
In the event of a wrongful termination by the public utility, the
public utility shall, in addition, be liable to the residential
occupants or customer for actual damages resulting from the
termination and for the costs of enforcement of this section,
including, but not limited to, reasonable attorney's fees, if the
residential occupants or the representative of the residential
occupants make a good faith effort to have the service continued
without interruption.
   (i) The public utility shall adopt rules and regulations necessary
to implement this section and shall liberally construe this section
to accomplish its purpose of ensuring that service to residential
occupants is not terminated due to nonpayment by the customer unless
the public utility has made every reasonable effort to continue
service to the residential occupants. The rules and regulations shall
include, but are not limited to, guidelines for assistance to actual
users in the enforcement of this section and requirements for the
notice prescribed by subdivision (a), including, but not limited to,
clear wording, large and boldface type, and comprehensive
instructions to ensure full notice to the actual user.
   (j) Nothing in this section broadens or restricts any authority of
a local agency that existed prior to January 1, 1989, to adopt an
ordinance protecting a residential occupant from the involuntary
termination of residential public utility service.
   (k) This section preempts any statute or ordinance permitting
punitive damages against any owner, manager, or operator on account
of an involuntary termination of residential public utility service
or permitting the recovery of costs associated with the formation,
maintenance, and termination of a tenants' association.
   (l) For purposes of this section, "representative of the
residential occupants" does not include a tenants' association.
  SEC. 206.  Section 99233.2 of the Public Utilities Code, as added
by Section 2 of Chapter 530 of the Statutes of 2009, is amended to
read:
   99233.2.  (a) Except as provided in subdivisions (b) and (c),
there shall be allocated to the transportation planning agency, if it
is statutorily created, such sums as it may approve, up to 3 percent
of annual revenues, for the conduct of the transportation planning
and programming process, unless a greater amount is approved by the
director.
   (b) (1) In those areas that have a county transportation
commission created pursuant to Section 130050, up to 1 percent of
annual revenues shall be allocated to the commission in Los Angeles
County, and up to 3 percent of the annual revenues shall be allocated
to the commissions in Orange, Riverside, and San Bernardino Counties
for the transportation planning and programming process. Of the
funds allocated to the commission in Riverside County, one-half shall
be allocated for planning studies within the Western Riverside
County and the Coachella Valley areas, as determined by the
commission.
   (2) In the area of the multicounty designated transportation
planning agency, as defined in Section 130004, up to three-fourths of
1 percent of annual revenues shall be allocated by the appropriate
entities, proportionately, on or before each July 1, to the
multicounty designated transportation planning agency for the
transportation planning and programming process. No operator shall
grant any funds it receives under this chapter to the designated
multicounty transportation planning agency for purposes of the agency
carrying out its responsibilities under Division 12 (commencing with
Section 130000).
   (c) In Ventura County, up to 2 percent of the annual revenues
shall be allocated to the Ventura County Transportation Commission
for the transportation planning and programming process.
   (d) This section shall become operative on July 1, 2011.
  SEC. 207.  Section 99312 of the Public Utilities Code is amended to
read:
   99312.  Except as provided in Sections 99311 and 99311.5, the
funds in the account shall be made available for the following
purposes:
   (a) Fifty percent for purposes of Section 99315.
   (b) To the Controller, 25 percent for allocation to transportation
planning agencies, county transportation commissions, and the San
Diego Metropolitan Transit Development Board pursuant to Section
99314.
   (c) To the Controller, 25 percent for allocation to transportation
agencies, county transportation commissions, and the San Diego
Metropolitan Transit Development Board for purposes of Section 99313.

   (d) For the 2007-08 fiscal year, notwithstanding any other
provision of this section, or any other provision of law, the
allocations made pursuant to this section shall be adjusted as
follows:
   (1) From the funds transferred to the account pursuant to
paragraph (1) of subdivision (a) of Section 7102 of the Revenue and
Taxation Code, fifty million dollars ($50,000,000) is hereby
appropriated to the Controller and shall be allocated pursuant to
subdivision (b); fifty million dollars ($50,000,000) is hereby
appropriated to the Controller and shall be allocated pursuant to
subdivision (c); and the remainder of revenue shall remain in the
Public Transportation Account to fund other state public
transportation priorities. The Controller shall make these
allocations in four equal quarterly amounts of twelve million five
hundred thousand dollars ($12,500,000), as achievable by the receipt
of the specified revenue.
   (2) The amount appropriated in Item 2640-101-0046 of Section 2.00
of the Budget Act of 2006 (Chapters 47 and 48 of the Statutes of
2006) for state transit assistance pursuant to subdivisions (b) and
(c) was greater than the amount of revenues received to support state
transit assistance pursuant to Section 7102 of the Revenue and
Taxation Code. Therefore, notwithstanding any other provision of law,
the amount that would have otherwise been available for
appropriation to state transit assistance in the 2007-08 fiscal year
pursuant to paragraphs (2) and (3) of subdivision (a) of Section 7102
of the Revenue and Taxation Code, shall be reduced by the excess
amount that was appropriated to state transit assistance in the
Budget Act of 2006, and that excess amount, as determined by the
Department of Finance, shall instead remain in the Public
Transportation Account to fund other state public transportation
priorities. The funding for state transit assistance as described in
this paragraph is hereby appropriated to the Controller for
allocation. The Controller shall attempt to spread this adjustment
equally over four quarterly payments, as achievable by revenue
estimates.
   (e) For the 2008-09 fiscal year and thereafter, notwithstanding
any other provision of this section or any other provision of law,
and except as provided in subdivision (f), the funds transferred to
the account pursuant to paragraph (1) of subdivision (a) of Section
7102 of the Revenue and Taxation Code shall be made available for the
following purposes:
   (1) For purposes of Section 99315, 33.34 percent, subject to
appropriation by the Legislature.
   (2) To the Controller, 33.33 percent for allocation to
transportation planning agencies, county transportation commissions,
and the San Diego Metropolitan Transit Development Board pursuant to
Section 99314. These funds are hereby continuously appropriated for
purposes of this paragraph.
   (3) To the Controller, 33.33 percent for the allocation to
transportation agencies, county transportation commissions, and the
San Diego Metropolitan Transit Development Board for purposes of
Section 99313. These funds are hereby continuously appropriated for
purposes of this paragraph.
   (f) For the 2009-10 to 2012-13 fiscal years, inclusive,
notwithstanding any other provision of this section or any other
provision of law, the funds in the account subject to this section
shall be made available only for purposes of Section 99315, subject
to appropriation by the Legislature.
  SEC. 208.  Section 185036 of the Public Utilities Code is amended
to read:
   185036.  Upon approval by the Legislature, by the enactment of a
statute, or approval by the voters of a financial plan providing the
necessary funding for the construction of a high-speed network, the
authority may do any of the following:
   (a) Enter into contracts with private or public entities for the
design, construction, and operation of high-speed trains. The
contracts may be separated into individual tasks or segments or may
include all tasks and segments, including a design-build or
design-build-operate contract.
   (b) Acquire rights-of-way through purchase or eminent domain.
   (c) Issue debt, secured by pledges of state funds, federal grants,
or project revenues. The pledge of state funds shall be limited to
those funds expressly authorized by statute or voter-approved
initiatives.
   (d) Enter into cooperative or joint development agreements with
local governments or private entities.
   (e) Set fares and schedules.
   (f) Relocate highways and utilities.
  SEC. 209.  Section 69 of the Revenue and Taxation Code is amended
to read:
   69.  (a) Notwithstanding any other law, pursuant to Section 2 of
Article XIII A of the California Constitution, the base year value of
property that is substantially damaged or destroyed by a disaster,
as declared by the Governor, may be transferred to comparable
property within the same county that is acquired or newly constructed
within five years after the disaster, or five years in the case of
the Northridge earthquake, as a replacement for the substantially
damaged or destroyed property. At the time the base year value of the
substantially damaged or destroyed property is transferred to the
replacement property, the substantially damaged or destroyed property
shall be reassessed at its full cash value; however, the
substantially damaged or destroyed property shall retain its base
year value
notwithstanding the transfer authorized by this section. If the owner
or owners of substantially damaged or destroyed property receive
property tax relief under this section, that property shall not be
eligible for property tax relief under subdivision (c) of Section 70
in the event of its reconstruction.
   (b) The replacement base year value of the replacement property
acquired shall be determined in accordance with this section.
   The assessor shall use the following procedure in determining the
appropriate replacement base year value of comparable replacement
property:
   (1) If the full cash value of the comparable replacement property
does not exceed 120 percent of the full cash value of the property
substantially damaged or destroyed, then the adjusted base year value
of the property substantially damaged or destroyed shall be
transferred to the comparable replacement property as its replacement
base year value.
   (2) If the full cash value of the replacement property exceeds 120
percent of the full cash value of the property substantially damaged
or destroyed, then the amount of the full cash value over 120
percent of the full cash value of the property substantially damaged
or destroyed shall be added to the adjusted base year value of the
property substantially damaged or destroyed. The sum of these amounts
shall become the replacement property's replacement base year value.

   (3) If the full cash value of the comparable replacement property
is less than the adjusted base year value of the property
substantially damaged or destroyed, then that lower value shall
become the replacement property's base year value.
   (4) The full cash value of the property substantially damaged or
destroyed shall be the amount of its full cash value immediately
prior to its substantial damage or destruction, as determined by the
county assessor of the county in which the property is located.
   (c) For purposes of this section:
   (1) Property is substantially damaged or destroyed if the land or
the improvements sustain physical damage amounting to more than 50
percent of its full cash value immediately prior to the disaster.
Damage includes a diminution in the value of property as a result of
restricted access to the property where the restricted access was
caused by the disaster and is permanent in nature.
   (2) Replacement property is comparable to the property
substantially damaged or destroyed if it is similar in size, utility,
and function to the property that it replaces.
   (A) Property is similar in function if the replacement property is
subject to similar governmental restrictions, such as zoning.
   (B) Both the size and utility of property are interrelated and
associated with value. Property is similar in size and utility only
to the extent that the replacement property is, or is intended to be,
used in the same manner as the property substantially damaged or
destroyed and its full cash value does not exceed 120 percent of the
full cash value of the property substantially damaged or destroyed.
   (i) A replacement property or any portion thereof used or intended
to be used for a purpose substantially different than the use made
of the property substantially damaged or destroyed shall to the
extent of the dissimilar use be considered not similar in utility.
   (ii) A replacement property or portion thereof that satisfies the
use requirement but has a full cash value that exceeds 120 percent of
the full cash value of the property substantially damaged or
destroyed shall be considered, to the extent of the excess, not
similar in utility and size.
   (C) To the extent that replacement property, or any portion
thereof, is not similar in function, size, and utility, the property,
or portion thereof, shall be considered to have undergone a change
in ownership when the replacement property is acquired or newly
constructed.
   (3) "Disaster" means a major misfortune or calamity in an area
subsequently proclaimed by the Governor to be in a state of disaster
as a result of the misfortune or calamity.
   (d) (1) This section applies to any comparable replacement
property acquired or newly constructed on or after July 1, 1985.
   (2) The amendments made by Chapter 1053 of the Statutes of 1993
apply to any comparable replacement property that is acquired or
newly constructed as a replacement for property substantially damaged
or destroyed by a disaster occurring on or after October 20, 1991,
and to the determination of base year values for the 1991-92 fiscal
year and fiscal years thereafter.
   (3) The amendments made by Chapter 317 of the Statutes of 2006
apply to any comparable replacement property that is acquired or
newly constructed as a replacement for property substantially damaged
or destroyed by a disaster occurring on or after July 1, 2003, and
to the determination of base year values for the 2003-04 fiscal year
and fiscal years thereafter.
   (e) Only the owner or owners of the property substantially damaged
or destroyed, whether one or more individuals, partnerships,
corporations, other legal entities, or a combination thereof, shall
receive property tax relief under this section. Relief under this
section shall be granted to an owner or owners of substantially
damaged or destroyed property obtaining title to replacement
property. The acquisition of an ownership interest in a legal entity
that, directly or indirectly, owns real property is not an
acquisition of comparable property.
  SEC. 210.  Section 69.3 of the Revenue and Taxation Code is amended
to read:
   69.3.  (a) (1) Notwithstanding any other law, pursuant to the
authority of paragraph (3) of subdivision (e) of Section 2 of Article
XIII A of the California Constitution, a county board of
supervisors, after consultation with affected local agencies located
within the boundaries of the county, may adopt an ordinance that
authorizes the transfer, subject to the conditions and limitations of
this section, of the base year value of real property that is
located within another county in this state and has been
substantially damaged or destroyed by a disaster to comparable
replacement property, including land, of equal or lesser value that
is located within the adopting county and has been acquired or newly
constructed as a replacement for the damaged or destroyed property
within three years after the damage or destruction of the original
property.
   (2) The base year value of the original property shall be the base
year value of the original property as determined in accordance with
Section 110.1, with the inflation factor adjustments permitted by
subdivision (f) of Section 110.1, determined as of the date
immediately prior to the date that the original property was
substantially damaged or destroyed. The base year value of the
original property shall also include any inflation factor adjustments
permitted by subdivision (f) of Section 110.1 for the period
subsequent to the date of the substantial damage to, or destruction
of, the original property and up to the date the replacement property
is acquired or newly constructed, regardless of whether the claimant
continued to own the original property during this entire period.
The base year or years used to compute the base year value of the
original property shall be deemed to be the base year or years of any
property to which that base year value is transferred pursuant to
this section.
   (b) For purposes of this section:
   (1) "Affected local agency" means any city, special district,
school district, or community college district that receives an
annual allocation of ad valorem property tax revenues.
   (2) "Claimant" means an owner or owners of real property claiming
the property tax relief provided by this section.
   (3) "Comparable replacement property" means a replacement property
that has a full cash value of equal or lesser value as defined in
paragraph (6).
   (4) "Consultation" means a noticed hearing that is conducted by a
county board of supervisors concerning the adoption of an ordinance
described in subdivision (a) and with respect to which all affected
local agencies within the boundaries of the county are provided with
reasonable notice of the time and the place of the hearing and a
reasonable opportunity to appear and participate.
   (5) "Disaster" means a major misfortune or calamity in an area
subsequently proclaimed by the Governor to be in a state of disaster
as a result of the misfortune or calamity.
   (6) "Equal or lesser value" means that the amount of the full cash
value of the replacement property does not exceed one of the
following:
   (A) One hundred five percent of the amount of the full cash value
of the original property if the replacement property is purchased or
newly constructed within the first year following the date of the
damage or destruction of the original property.
   (B) One hundred ten percent of the amount of the full cash value
of the original property if the replacement property is purchased or
newly constructed within the second year following the date of the
damage or destruction of the original property.
   (C) One hundred fifteen percent of the amount of the full cash
value of the original property if the replacement property is
purchased or newly constructed within the third year following the
date of the damage or destruction of the original property.
   For purposes of this paragraph, if the replacement property is, in
part, purchased and, in part, newly constructed, the date the
"replacement property is purchased or newly constructed" is the date
of the purchase or the date of completion of new construction,
whichever is later.
   (7) "Full cash value of the original property" means its full cash
value, as determined in accordance with Section 110, immediately
prior to its substantial damage or destruction, as determined by the
county assessor of the county in which the property is located.
   (8) "Full cash value of the replacement property" means its full
cash value, as determined in accordance with Section 110.1 as of the
date upon which it was purchased or new construction was completed,
that is applicable on and after that date.
   (9) "Original property" means a building, structure, or other
shelter constituting a place of abode, whether real property or
personal property, that is owned and occupied by a claimant as his or
her principal place of residence, and any land owned by the claimant
on which the building, structure, or other shelter is situated, that
has been substantially damaged or destroyed by a disaster. For
purposes of this paragraph, land constituting a part of original
property includes only that area of reasonable size that is used as a
site for a residence, and "land owned by the claimant" includes land
for which the claimant either holds a leasehold interest described
in subdivision (c) of Section 61 or a land purchase contract. For
purposes of this paragraph, each unit of a multiunit dwelling shall
be considered a separate original property.
   (10) "Owner or owners" means an individual or individuals, but
does not include any firm, partnership, association, corporation,
company, or other legal entity or organization of any kind.
   (11) "Replacement property" means a building, structure, or other
shelter constituting a place of abode, whether real property or
personal property, that is owned and occupied by a claimant as his or
her principal place of residence, and any land owned by the claimant
on which the building, structure, or other shelter is situated. For
purposes of this paragraph, land constituting a part of the
replacement property includes only that area of reasonable size that
is used as the site for a residence, and "land owned by the claimant"
includes land for which the claimant either holds a leasehold
interest described in subdivision (c) of Section 61 or a land
purchase contract. For purposes of this paragraph, each unit of a
multiunit dwelling shall be considered a separate replacement
property. "Replacement property" does not include any property,
including land or improvements, if the claimant owned any portion of
that property prior to the date of the disaster that damaged or
destroyed the original property.
   (12) "Substantially damaged or destroyed" means property where
either the land or the improvements sustain physical damage amounting
to more than 50 percent of its full cash value immediately prior to
the disaster. Damage includes a diminution in the value of property
as a result of restricted access to the property where the restricted
access was caused by the disaster and is permanent in nature.
   (c) At the time the base year value of the substantially damaged
or destroyed property is transferred to the replacement property
pursuant to an ordinance adopted under this section, the
substantially damaged or destroyed property shall be reassessed at
its full cash value. However, the substantially damaged or destroyed
property shall retain its base year value notwithstanding that
transfer. If the owner or owners of substantially damaged or
destroyed property receive property tax relief under this section,
that property shall not be eligible for property tax relief under
subdivision (c) of Section 70 in the event of its reconstruction.
   (d) Only the owner or owners of the property that has been
substantially damaged or destroyed may receive property tax relief
under an ordinance adopted pursuant to this section. Relief under an
ordinance adopted pursuant to this section shall be granted to an
owner or owners of a substantially damaged or destroyed property
obtaining comparable replacement property. The acquisition of an
ownership interest in a legal entity that, directly or indirectly,
owns real property is not an acquisition of comparable replacement
property for purposes of this section.
   (e) A timely claim for relief under an ordinance adopted pursuant
to this section, in that form as shall be prescribed by the board,
shall be filed by the owner with the assessor of the county in which
the replacement property is located. No relief under an ordinance
adopted pursuant to this section shall be granted unless the claim is
filed no later than January 1, 1996, or within three years after the
replacement property is acquired or newly constructed, whichever is
later.
   (f) Any taxes that were levied on the replacement property prior
to the filing of a claim on the basis of the replacement property's
new base year value, and any allowable annual adjustments thereto,
shall be canceled or refunded to the claimant to the extent that
taxes exceed the amount that would be due when determined on the
basis of the adjusted new base year value.
   (g) This section shall apply to any comparable replacement
property of equal or lesser value that is acquired or newly
constructed as a replacement for property that has been substantially
damaged or destroyed by a disaster occurring on or after October 20,
1991, and to the determination of base year values for the 1991-92
fiscal year and each fiscal year thereafter.
  SEC. 211.  Section 276 of the Revenue and Taxation Code is amended
to read:
   276.  (a) Except as otherwise provided by subdivision (b), for
property for which the disabled veterans' exemption described in
Section 205.5 was available, but for which a timely claim was not
filed, a partial exemption shall be applied in accordance with
whichever of the following is applicable:
   (1) Ninety percent of any tax, including any interest or penalty
thereon, levied upon that portion of the assessed value of the
property that would have been exempt under a timely and appropriate
claim shall be canceled or refunded, provided that an appropriate
claim for exemption is filed after 5 p.m. on February 15 of the
calendar year in which the fiscal year begins but on or before the
following December 10.
   (2) If an appropriate claim for exemption is filed after the time
period specified in paragraph (1), 85 percent of that portion of any
tax, including any interest or penalty thereon, that was levied upon
that portion of the assessed value of the property that would have
been exempt under a timely and appropriate claim, shall be canceled
or refunded. Cancellations made under this paragraph are subject to
the provisions of Article 1 (commencing with Section 4985) of Chapter
4. Refunds issued under this paragraph are subject to the
limitations periods on refunds as described in Article 1 (commencing
with Section 5096) of Chapter 5.
   (b) If a late-filed claim for the
one-hundred-fifty-thousand-dollar ($150,000) exemption is filed in
conjunction with a timely filed claim for the
one-hundred-thousand-dollar ($100,000) exemption, the amount of any
exemption allowed under the late-filed claim under subdivision (a)
shall be determined on the basis of that portion of the exemption
amount, otherwise available under subdivision (a), that exceeds one
hundred thousand dollars ($100,000).
   (c) For those claims filed pursuant to subdivision (a) after
November 15, the exemption under that subdivision may be applied to
the second installment. If that exemption is so applied, the first
installment is still delinquent on December 10, and is subject to
delinquent penalties provided for in this division if that
installment is not timely paid. A refund shall be made to the
taxpayer upon a claim submitted to the auditor if the exemption is
applied to the second installment and either of the following is
true:
   (1) Both installments are paid on or before December 10.
   (2) The reduction in taxes resulting from the exemption exceeds
the amount of taxes due on the second installment.
  SEC. 212.  Section 6018.6 of the Revenue and Taxation Code is
amended to read:
   6018.6.  (a) Any person who received no more than 20 percent of
his or her total gross receipts from the alteration of garments
during the preceding calendar year is a consumer of, and shall not be
considered a retailer within the provisions of this part with
respect to, property used or furnished by that person in altering new
or used clothing, provided that both of the following apply:
   (1) That person operates a location or locations as a pickup and
delivery point for garment cleaning, or provides spotting and
pressing services on the premises but not garment cleaning, or
operates a garment cleaning or dyeing plant on the premises.
   (2) Seventy-five percent or more of that person's total gross
receipts represent charges for garment cleaning or dyeing services.
   (b) Sales tax shall not apply to the charges for alterations
specified in subdivision (a). However, that person is a retailer of
any other tangible personal property sold to consumers in the regular
course of business and sales tax shall apply to the gross receipts
from those sales.
   (c) For the purpose of this section:
   (1) "Cleaning" means wet cleaning and drycleaning.
   (2) "Wet cleaning" means the process of cleaning a garment by
immersion in water, or by applying manually or by any mechanical
device, water, or any detergent and water, or by spraying or brushing
the garment with water or water and any detergent, or water vapor,
or steam, and includes self-service or coin-operated equipment in
whole or in part.
   (3) "Drycleaning" means the process of cleaning or renovating
wearing apparel, feathers, furs, hats, fabrics, household items, or
textiles by immersion and agitation, spraying, vaporization, or
immersion only, in a volatile, commercially moisture-free solvent or
by the use of a volatile or inflammable product, applied either
manually or by means of a mechanical appliance and including
self-service or coin-operated equipment in whole or in part.
   (4) "Dyeing" means the process of coloring wearing apparel,
feathers, furs, hats, fabrics, or textiles by the use of aniline
dyes, mordants, or acids, with or without steam, excluding, however,
the use of any dye or combination of dyes which is directly soluble
or dispersible in water and which does not require chemical
alteration of its structure for application, where that dye or
combination of dyes is applied to cotton, viscose rayon, or
cuprammonium rayon other than wearing apparel.
   (5) "Spotting" means the process of removing spots or stains or
localized areas of soil from a garment, either before or after, and
with or without drycleaning or wet cleaning, by brushing, spraying,
or other means of manual or mechanical application, other than
immersion, with water, detergents, and volatile or inflammable
solvents, chemicals, or any, or all of them.
   (6) "Pressing" means the process of restoring the garment to the
original shape, dimensions, or contour thereof, or to those in which
the same was received from the customer, or as directed by the
customer, and the removal of wrinkles, stresses, bulges, and
impressions, imprint marks and shine, from a garment by the
application of pressure, heat, moisture, water vapor, or steam, or
all of them, whether applied manually, or by any mechanical means.
  SEC. 213.  Section 6248 of the Revenue and Taxation Code is amended
to read:
   6248.  (a) There shall be a rebuttable presumption that any
vehicle, vessel, or aircraft bought outside of this state on or after
the effective date of this section, and which is brought into
California within 12 months from the date of its purchase, was
acquired for storage, use, or other consumption in this state and is
subject to use tax if any of the following occurs:
   (1) The vehicle, vessel, or aircraft was purchased by a California
resident as defined in Section 516 of the Vehicle Code. For purposes
of this section, a closely held corporation or limited liability
company shall also be considered a California resident if 50 percent
or more of the shares or membership interests are held by
shareholders or members who are residents of California as defined in
Section 516 of the Vehicle Code.
   (2) In the case of a vehicle, the vehicle was subject to
registration under Chapter 1 (commencing with Section 4000) of
Division 3 of the Vehicle Code during the first 12 months of
ownership.
   (3) In the case of a vessel or aircraft, that vessel or aircraft
was subject to property tax in this state during the first 12 months
of ownership.
   (4) If purchased by a nonresident of California, the vehicle,
vessel, or aircraft is used or stored in this state more than
one-half of the time during the first 12 months of ownership.
   (b) This presumption may be controverted by documentary evidence
that the vehicle, vessel, or aircraft was purchased for use outside
of this state during the first 12 months of ownership. This evidence
may include, but is not limited to, evidence of registration of that
vehicle, vessel, or aircraft, with the proper authority, outside of
this state.
   (c) This section shall not apply to any vehicle, vessel, or
aircraft used in interstate or foreign commerce pursuant to
regulations prescribed by the board.
   (d) The amendments made to this section by the act adding this
subdivision shall not apply to any vehicle, vessel, or aircraft that
is either purchased, or is the subject of a binding purchase contract
that is entered into, on or before the operative date of this
subdivision.
   (e) Notwithstanding subdivision (a), any aircraft or vessel
brought into this state exclusively for the purpose of repair,
retrofit, or modification shall not be deemed to be acquired for
storage, use, or other consumption in this state if the repair,
retrofit, or modification is, in the case of a vessel, performed by a
repair facility that holds an appropriate permit issued by the board
and is licensed to do business by the county in which it is located,
or, in the case of an aircraft, performed by a repair station
certified by the Federal Aviation Administration or a manufacturer's
maintenance facility.
   (f) The presumption set forth in subdivision (a) may be
controverted by documentary evidence that the vehicle was brought
into this state for the exclusive purpose of warranty or repair
service and was used or stored in this state for that purpose for 30
days or less. The 30-day period begins when the vehicle enters this
state, includes any time of travel to and from the warranty or repair
facility, and ends when the vehicle is returned to a point outside
the state. The documentary evidence shall include a work order
stating the dates that the vehicle is in the possession of the
warranty or repair facility and a statement by the owner of the
vehicle specifying dates of travel to and from the warranty or repair
facility.
  SEC. 214.  Section 6363.4 of the Revenue and Taxation Code is
amended to read:
   6363.4.  (a) There are exempted from the taxes imposed by this
part, the gross receipts from the sale in this state of, and the
storage, use, or other consumption in this state of, tangible
personal property sold by a thrift store located on a military
installation and operated by a designated entity that, in partnership
with the United States Department of Defense, provides financial,
educational, and other assistance to members of the Armed Forces of
the United States, eligible family members, and survivors that are in
need.
   (b) For purposes of this section, "designated entity" means a
military welfare society described in Section 1033 of Chapter 53 of
Part II of Subtitle A of Title 10 of the United States Code.
   (c) This section shall remain in effect only until January 1,
2014.
  SEC. 215.  Section 7104 of the Revenue and Taxation Code is amended
to read:
   7104.  (a) The Transportation Investment Fund (hereafter the fund)
is hereby created in the State Treasury. Notwithstanding Section
13340 of the Government Code, the moneys in the fund are continuously
appropriated without regard to fiscal years for disbursement in the
manner and for the purposes set forth in this section.
   (b) All of the following shall occur on a quarterly basis:
   (1) The State Board of Equalization, in consultation with the
Department of Finance, shall estimate the amount that is transferred
to the General Fund under subdivision (b) of Section 7102 that is
attributable to revenue collected for the sale, storage, use, or
other consumption in this state of motor vehicle fuel, as defined in
Section 7326.
   (2) The State Board of Equalization shall inform the Controller,
in writing, of the amount estimated under paragraph (1).
   (3) Commencing with the 2003-04 fiscal year, the Controller shall
transfer the amount estimated under paragraph (1) from the General
Fund to the fund.
   (c) For each quarter during the period commencing on July 1, 2003,
and ending on June 30, 2008, the Controller shall make all of the
following transfers and apportionments from the funds identified for
transfer under paragraph (2) of subdivision (b) in the following
order:
                                              (1) To the Traffic
Congestion Relief Fund created in the State Treasury by Section
14556.5 of the Government Code, the sum of one hundred sixty-nine
million five hundred thousand dollars ($169,500,000), except that the
transfer for the final quarter shall be ninety-three million four
hundred thousand dollars ($93,400,000), for a total transfer of three
billion three hundred thirteen million nine hundred thousand dollars
($3,313,900,000).
   (2) To the Public Transportation Account, a trust fund in the
State Transportation Fund, 20 percent of the amount remaining after
the transfer required under paragraph (1). Funds transferred under
this paragraph shall be made available as follows:
   (A) To the Department of Transportation, 50 percent for purposes
of subdivision (a) or (b) of Section 99315 of the Public Utilities
Code, subject to appropriation by the Legislature.
   (B) To the Controller, 25 percent for allocation pursuant to
Section 99314 of the Public Utilities Code. Funds allocated under
this subparagraph shall be subject to all of the provisions governing
funds allocated under Section 99314 of the Public Utilities Code.
For the 2007-08 fiscal year, these funds are continuously
appropriated to the Controller for purposes of this subparagraph.
   (C) To the Controller, 25 percent for allocation pursuant to
Section 99313 of the Public Utilities Code. Funds allocated under
this subparagraph shall be subject to all of the provisions governing
funds allocated under Section 99313 of the Public Utilities Code.
For the 2007-08 fiscal year, these funds are continuously
appropriated to the Controller for purposes of this subparagraph.
   (3) To the Department of Transportation for expenditure for
programming for transportation capital improvement projects subject
to all of the provisions governing the State Transportation
Improvement Program, 40 percent of the amount remaining after the
transfer required under paragraph (1), except that in the 2006-07 and
2007-08 fiscal years, the transfer shall be 80 percent of the amount
remaining after the transfer required under paragraph (1).
   (4) To the Controller for apportionment to the counties, including
a city and county, 20 percent of the amount remaining after the
transfer required under paragraph (1), except that in the 2006-07 and
2007-08 fiscal years, no transfer may be made under this paragraph.
Funds transferred under this paragraph shall be allocated in
accordance with the following formulas:
   (A) Seventy-five percent of the funds payable under this paragraph
shall be apportioned among the counties in the proportion that the
number of fee-paid and exempt vehicles that are registered in the
county bears to the number of fee-paid and exempt vehicles registered
in the state.
   (B) Twenty-five percent of the funds payable under this paragraph
shall be apportioned among the counties in the proportion that the
number of miles of maintained county roads in each county bears to
the total number of miles of maintained county roads in the state.
For the purposes of apportioning funds under this subparagraph, any
roads within the boundaries of a city and county that are not state
highways shall be deemed to be county roads.
   (5) To the Controller for apportionment to cities, including a
city and county, 20 percent of the amount remaining after the
transfer required under paragraph (1), except that in the 2006-07 and
2007-08 fiscal years, no transfer may be made under this paragraph.
Funds transferred under this paragraph shall be apportioned among the
cities in the proportion that the total population of the city bears
to the total population of all the cities in the state.
   (d) Funds received under paragraph (4) or (5) of subdivision (c)
shall be deposited as follows in order to avoid the commingling of
those funds with other local funds:
   (1) In the case of a city, into the city account that is
designated for the receipt of state funds allocated for
transportation purposes.
   (2) In the case of a county, into the county road fund.
   (3) In the case of a city and county, into a local account that is
designated for the receipt of state funds allocated for
transportation purposes.
   (e) Funds allocated to a city, county, or city and county under
paragraph (4) or (5) of subdivision (c) shall be used only for street
and highway maintenance, rehabilitation, reconstruction, and storm
damage repair. For purposes of this section, the following terms have
the following meanings:
   (1) "Maintenance" means either or both of the following:
   (A) Patching.
   (B) Overlay and sealing.
   (2) "Reconstruction" includes any overlay, sealing, or widening of
the roadway, if the widening is necessary to bring the roadway width
to the desirable minimum width consistent with the geometric design
criteria of the department for 3R (reconstruction, resurfacing, and
rehabilitation) projects that are not on a freeway, but does not
include widening for the purpose of increasing the traffic capacity
of a street or highway.
   (3) "Storm damage repair" is repair or reconstruction of local
streets and highways and related drainage improvements that have been
damaged due to winter storms and flooding, and construction of
drainage improvements to mitigate future roadway flooding and damage
problems, in those jurisdictions that have been declared disaster
areas by the President of the United States, where the costs of those
repairs are ineligible for emergency funding with Federal Emergency
Relief (ER) funds or Federal Emergency Management Administration
(FEMA) funds.
   (f) (1) Cities and counties shall maintain their existing
commitment of local funds for street and highway maintenance,
rehabilitation, reconstruction, and storm damage repair in order to
remain eligible for the allocation of funds pursuant to paragraph (4)
or (5) of subdivision (c).
   (2) In order to receive any allocation pursuant to paragraph (4)
or (5) of subdivision (c), the city or county shall annually expend
from its general fund for street, road, and highway purposes an
amount not less than the annual average of its expenditures from its
general fund during the 1996-97, 1997-98, and 1998-99 fiscal years,
as reported to the Controller pursuant to Section 2151 of the Streets
and Highways Code. For purposes of this paragraph, in calculating a
city's or county's annual general fund expenditures and its average
general fund expenditures for the 1996-97, 1997-98, and 1998-99
fiscal years, any unrestricted funds that the city or county may
expend at its discretion, including vehicle in-lieu tax revenues and
revenues from fines and forfeitures, expended for street and highway
purposes shall be considered expenditures from the general fund.
One-time allocations that have been expended for street and highway
purposes, but which may not be available on an ongoing basis,
including revenue provided under the Teeter Plan Bond Law of 1994
(Chapter 6.6 (commencing with Section 54773) of Part 1 of Division 2
of Title 5 of the Government Code, may not be considered when
calculating a city's or county's annual general fund expenditures.
   (3) For any city incorporated after July 1, 1996, the Controller
shall calculate an annual average of expenditure for the period
between July 1, 1996, and December 31, 2000, inclusive, that the city
was incorporated.
   (4) For purposes of paragraph (2), the Controller may request
fiscal data from cities and counties in addition to data provided
pursuant to Section 2151, for the 1996-97, 1997-98, and 1998-99
fiscal years. Each city and county shall furnish the data to the
Controller not later than 120 days after receiving the request. The
Controller may withhold payment to cities and counties that do not
comply with the request for information or that provide incomplete
data.
   (5) The Controller may perform audits to ensure compliance with
paragraph (2) when deemed necessary. Any city or county that has not
complied with paragraph (2) shall reimburse the state for the funds
it received during that fiscal year. Any funds withheld or returned
as a result of a failure to comply with paragraph (2) shall be
reallocated to the other counties and cities whose expenditures are
in compliance.
   (6) If a city or county fails to comply with the requirements of
paragraph (2) in a particular fiscal year, the city or county may
expend during that fiscal year and the following fiscal year a total
amount that is not less than the total amount required to be expended
for those fiscal years for purposes of complying with paragraph (2).

   (7) The allocation made under paragraph (4) or (5) of subdivision
(c) shall be expended not later than the end of the fiscal year
following the fiscal year in which the allocation was made, and any
funds not expended within that period shall be returned to the
Controller and shall be reallocated to the other cities and counties
pursuant to the allocation formulas set forth in paragraph (4) or (5)
of subdivision (c).
   (g) The Los Angeles County Metropolitan Transportation Authority
shall give first priority for using its share of the funds made
available under subparagraphs (B) and (C) of paragraph (2) of
subdivision (c) to providing the levels of bus service mandated under
the consent decree entered into by the authority on October 29,
1996, in the case of Labor/Community Strategy Center, et al. v. Los
Angeles County Metropolitan Transportation Authority.
   (h) (1) For the purpose of allocating funds under paragraph (4) or
(5) of subdivision (c) to counties, cities, and a city and county,
the Controller shall use the most recent population estimates
prepared by the Demographic Research Unit of the Department of
Finance. For a city that incorporated after January 1, 1998, that
does not appear on the most recent population estimates prepared by
the Demographic Research Unit, the Controller shall use the
population determined for that city under Section 11005.3 of the
Revenue and Taxation Code.
   (2) The amendments made to Section 11005.3 by the act adding this
paragraph shall not apply to a population determination under
paragraph (1).
   (i) This section shall become inoperative on the date that all
encumbrances incurred for the projects funded under paragraph (3) of
subdivision (c) have been liquidated or on June 30, 2008, whichever
date is later, and as of the January 1 immediately following that
date is repealed.
  SEC. 216.  Section 7104.2 of the Revenue and Taxation Code is
amended to read:
   7104.2.  (a) The Transportation Investment Fund (hereafter the
fund) in the State Treasury is hereby continued in existence. All
revenues transferred to the fund pursuant to Article XIX B of the
California Constitution beginning with the 2008-09 fiscal year shall
be available for expenditure as provided in this section.
Notwithstanding Section 13340 of the Government Code or any other
provision of law, moneys in the fund are continuously appropriated
without regard to fiscal years for disbursement in the manner and for
the purposes set forth in this section.
   (b) All of the following shall occur on a quarterly basis:
   (1) The State Board of Equalization, in consultation with the
Department of Finance, shall estimate the amount that is transferred
to the General Fund under subdivision (b) of Section 7102 that is
attributable to revenue collected for the sale, storage, use, or
other consumption in this state of motor vehicle fuel, as defined in
Section 7326.
   (2) The State Board of Equalization shall inform the Controller,
in writing, of the amount estimated under paragraph (1).
   (3) Commencing with the 2008-09 fiscal year, the Controller shall
transfer the amount estimated under paragraph (1) from the General
Fund to the fund.
   (c) For each quarter, commencing with the 2008-09 fiscal year, the
Controller shall make all of the following transfers and
apportionments from the fund:
   (1) To the Public Transportation Account, a trust fund in the
State Transportation Fund, 20 percent of the revenues deposited in
the fund. Funds transferred under this paragraph shall be made
available as follows:
   (A) Twenty-five percent for purposes of Section 99315 of the
Public Utilities Code, subject to appropriation by the Legislature.
   (B) Thirty-seven and one-half percent to the Controller, for
allocation pursuant to Section 99314 of the Public Utilities Code.
Funds allocated under this subparagraph shall be subject to all of
the provisions governing funds allocated under Section 99314 of the
Public Utilities Code. These funds are continuously appropriated to
the Controller for purposes of this subparagraph.
   (C) Thirty-seven and one-half percent to the Controller, for
allocation pursuant to Section 99313 of the Public Utilities Code.
Funds allocated under this subparagraph shall be subject to all of
the provisions governing funds allocated under Section 99313 of the
Public Utilities Code. These funds are continuously appropriated to
the Controller for purposes of this subparagraph.
   (D) Notwithstanding subparagraphs (A), (B), and (C), for the
2009-10 to 2012-13 fiscal years, inclusive, all funds transferred
under this paragraph shall be made available only for purposes of
Section 99315 of the Public Utilities Code, subject to appropriation
by the Legislature.
   (2) To the Department of Transportation for expenditure for
transportation capital improvement projects subject to all of the
rules governing the State Transportation Improvement Program, 40
percent of the revenues deposited in the fund.
   (3) To the Controller for apportionment pursuant to subparagraphs
(A) and (B), 40 percent of the revenues deposited in the fund.
   (A) Of the amount available under this paragraph, 50 percent shall
be apportioned by the Controller to the counties, including a city
and county, in accordance with the following formulas:
   (i) Seventy-five percent of the funds payable under this
subparagraph shall be apportioned among the counties in the
proportion that the number of fee-paid and exempt vehicles that are
registered in the county bears to the number of fee-paid and exempt
vehicles registered in the state.
   (ii) Twenty-five percent of the funds payable under this
subparagraph shall be apportioned among the counties in the
proportion that the number of miles of maintained county roads in
each county bears to the total number of miles of maintained county
roads in the state. For the purposes of apportioning funds under this
subparagraph, any roads within the boundaries of a city and county
that are not state highways shall be deemed to be county roads.
   (B) Of the amount available under this paragraph, 50 percent shall
be apportioned by the Controller to cities, including a city and
county, in the proportion that the total population of the city bears
to the total population of all the cities in the state.
   (d) Funds received under subparagraph (A) or (B) of paragraph (3)
of subdivision (c) shall be deposited as follows in order to avoid
the commingling of those funds with other local funds:
   (1) In the case of a city, into the city account that is
designated for the receipt of state funds allocated for
transportation purposes.
   (2) In the case of a county, into the county road fund.
   (3) In the case of a city and county, into a local account that is
designated for the receipt of state funds allocated for
transportation purposes.
   (e) Funds allocated to a city, county, or city and county under
subparagraph (A) or (B) of paragraph (3) of subdivision (c) shall be
used only for street and highway maintenance, rehabilitation,
reconstruction, and storm damage repair. For purposes of this
section, the following terms have the following meanings:
   (1) "Maintenance" means either or both of the following:
   (A) Patching.
   (B) Overlay and sealing.
   (2) "Reconstruction" includes any overlay, sealing, or widening of
the roadway, if the widening is necessary to bring the roadway width
to the desirable minimum width consistent with the geometric design
criteria of the department for 3R (reconstruction, resurfacing, and
rehabilitation) projects that are not on a freeway, but does not
include widening for the purpose of increasing the traffic capacity
of a street or highway.
   (3) "Storm damage repair" is repair or reconstruction of local
streets and highways and related drainage improvements that have been
damaged due to winter storms and flooding, and construction of
drainage improvements to mitigate future roadway flooding and damage
problems, in those jurisdictions that have been declared disaster
areas by the President of the United States, where the costs of those
repairs are ineligible for emergency funding with Federal Emergency
Relief (ER) funds or Federal Emergency Management Administration
(FEMA) funds.
   (f) (1) Cities and counties shall maintain their existing
commitment of local funds for street and highway maintenance,
rehabilitation, reconstruction, and storm damage repair in order to
remain eligible for the allocation of funds pursuant to subparagraph
(A) or (B) of paragraph (3) of subdivision (c).
   (2) In order to receive any allocation pursuant to subparagraph
(A) or (B) of paragraph (3) of subdivision (c), the city or county
shall annually expend from its general fund for street, road, and
highway purposes an amount not less than the annual average of its
expenditures from its general fund during the 1996-97, 1997-98, and
1998-99 fiscal years, as reported to the Controller pursuant to
Section 2151 of the Streets and Highways Code. For purposes of this
paragraph, in calculating a city's or county's annual general fund
expenditures and its average general fund expenditures for the
1996-97, 1997-98, and 1998-99 fiscal years, any unrestricted funds
that the city or county may expend at its discretion, including
vehicle in-lieu tax revenues and revenues from fines and forfeitures,
expended for street and highway purposes shall be considered
expenditures from the general fund. One-time allocations that have
been expended for street and highway purposes, but which may not be
available on an ongoing basis, including revenue provided under the
Teeter Plan Bond Law of 1994 (Chapter 6.6 (commencing with Section
54773) of Part 1 of Division 2 of Title 5 of the Government Code, may
not be considered when calculating a city's or county's annual
general fund expenditures.
   (3) For any city incorporated after July 1, 1996, the Controller
shall calculate an annual average of expenditure for the period
between July 1, 1996, and December 31, 2000, inclusive, that the city
was incorporated.
   (4) For purposes of paragraph (2), the Controller may request
fiscal data from cities and counties in addition to data provided
pursuant to Section 2151, for the 1996-97, 1997-98, and 1998-99
fiscal years. Each city and county shall furnish the data to the
Controller not later than 120 days after receiving the request. The
Controller may withhold payment to cities and counties that do not
comply with the request for information or that provide incomplete
data.
   (5) The Controller may perform audits to ensure compliance with
paragraph (2) when deemed necessary. Any city or county that has not
complied with paragraph (2) shall reimburse the state for the funds
it received during that fiscal year. Any funds withheld or returned
as a result of a failure to comply with paragraph (2) shall be
reallocated to the other counties and cities whose expenditures are
in compliance.
   (6) If a city or county fails to comply with the requirements of
paragraph (2) in a particular fiscal year, the city or county may
expend during that fiscal year and the following fiscal year a total
amount that is not less than the total amount required to be expended
for those fiscal years for purposes of complying with paragraph (2).

   (7) The allocation made under subparagraph (A) or (B) of paragraph
(3) of subdivision (c) shall be expended not later than the end of
the fiscal year following the fiscal year in which the allocation was
made, and any funds not expended within that period shall be
returned to the Controller and shall be reallocated to the other
cities and counties pursuant to the allocation formulas set forth in
subparagraph (A) or (B) of paragraph (3) of subdivision (c).
   (g) For the purpose of allocating funds under subparagraph (A) or
(B) of paragraph (3) of subdivision (c) to counties, cities, and a
city and county, the Controller shall use the most recent population
estimates prepared by the Demographic Research Unit of the Department
of Finance. For a city that incorporated after January 1, 2008, that
does not appear on the most recent population estimates prepared by
the Demographic Research Unit, the Controller shall use the
population determined for that city under Section 11005.3.
   (h) (1) Notwithstanding any other law, the quarterly
apportionments scheduled to be made in October 2009 and January 2010
pursuant to paragraph (3) of subdivision (c) shall be suspended and
deferred until May 31, 2010.
   (2) For the purpose of meeting the cash obligations associated
with ongoing budgeted costs, a city or county may make use of any
cash balance in its city or county road fund, including that
resulting from the receipt of funds pursuant to the Highway Safety,
Traffic Reduction, Air Quality, and Port Security Bond Act of 2006
(Chapter 12.49 (commencing with Section 8879.20) of Division 1 of
Title 2 of the Government Code (hereafter bond act)) for local street
and road maintenance, during the period of this suspension, without
the use of this cash being reflected as an expenditure of bond act
funds, provided the cash is replaced once this suspension is repaid.
Nothing in this paragraph shall change the fact that expenditures
must be accrued and reflected from the appropriate funding sources
for which the moneys were received and meet all requirements of those
funding sources.
  SEC. 217.  Section 30461.6 of the Revenue and Taxation Code is
amended to read:
   30461.6.  (a) Notwithstanding Section 30461, the board shall
transmit the revenue derived from the increase in the cigarette tax
rate of one mill ($0.001) per cigarette imposed by Section 30101 on
and after January 1, 1994, to the Treasurer to be deposited in the
State Treasury to the credit of the Breast Cancer Fund, which fund is
hereby created. The Breast Cancer Fund shall consist of two
accounts: the Breast Cancer Research Account and the Breast Cancer
Control Account. The revenues deposited in the fund shall be divided
equally between the two accounts.
   (b) The moneys in the accounts within the Breast Cancer Fund
shall, upon appropriation by the Legislature, be allocated as
follows:
   (1) The moneys in the Breast Cancer Research Account shall be
allocated for research with respect to the cause, cure, treatment,
earlier detection, and prevention of breast cancer as follows:
   (A) Ten percent to the Cancer Surveillance Section of the State
Department of Public Health for the collection of breast
cancer-related data and the conduct of breast cancer-related
epidemiological research by the state cancer registry established
pursuant to Section 103885 of the Health and Safety Code.
   (B) Ninety percent to the Breast Cancer Research Program, that is
hereby created at the University of California, for the awarding of
grants and contracts to researchers for research with respect to the
cause, cure, treatment, prevention, and earlier detection of breast
cancer and with respect to the cultural barriers to accessing the
health care system for early detection and treatment of breast
cancer.
   (2) The moneys in the Breast Cancer Control Account shall be
allocated to the Breast Cancer Control Program, that is hereby
created for the provision of early breast cancer detection services
for uninsured and underinsured women. The Breast Cancer Control
Program shall be established in the State Department of Public Health
and shall be administered in coordination with the breast and
cervical cancer control program established pursuant to Public Law
101-354.
   (c) The early breast cancer detection services provided by the
Breast Cancer Control Program shall include all of the following:
   (1) Screening, including mammography, of women for breast cancer
as an early detection health care measure.
   (2) After screening, medical referral of screened women and
services necessary for definitive diagnosis, including
nonradiological techniques or biopsy.
   (3) If a positive diagnosis is made, then assistance and advocacy
shall be provided to help the person obtain necessary treatment.
   (4) Outreach and health education activities to ensure that
uninsured and underinsured women are aware of and appropriately
utilize the services provided by the Breast Cancer Control Program.
   (d) (1) Any entity funded by the Breast Cancer Control Program
shall coordinate with other local providers of breast cancer
screening, diagnostic, followup, education, and advocacy services to
avoid duplication of effort. Any entity funded by the program shall
comply with any applicable state and federal standards regarding
mammography quality assurance.
   (2) To the extent required or permitted by federal law, a provider
of breast cancer screening or diagnostic services may employ digital
mammography technology for the purposes of mammography screening and
diagnostic procedures that are conducted prior to January 1, 2014,
when film, otherwise known as analog, mammography technology is
unavailable. To the extent required or permitted by federal law and
notwithstanding paragraph (3) of subdivision (a) of Section 14105.18
of the Welfare and Institutions Code, the payment rate for all
mammography screening that is conducted prior to January 1, 2014,
shall be limited to the Medi-Cal payment rate for film mammography
screening.
   (e) (1) The State Department of Public Health shall provide for
breast cancer screening services at the level of funding budgeted
from state and other resources during the fiscal year in which the
Legislature has appropriated funds to the department for this
purpose.
   (2) Administrative costs of the State Department of Public Health
shall not exceed 10 percent of the funds allocated to the Breast
Cancer Control Program created pursuant to paragraph (2) of
subdivision (b). Indirect costs of the entities funded by this
program shall not exceed 12 percent. The department shall define
"indirect costs" in accordance with applicable state and federal law.

   (f) Any entity funded by the Breast Cancer Control Program shall
collect data and maintain records that are determined by the State
Department of Public Health to be necessary to facilitate the
department's ability to monitor and evaluate the effectiveness of the
entities and
the program. Commencing with the program's second year of operation,
the State Department of Public Health shall submit an annual report
to the Legislature and any other appropriate entity. The costs
associated with this report shall be paid from the allocation made
pursuant to paragraph (2) of subdivision (b). The report shall
describe the activities and effectiveness of the program and shall
include, but not be limited to, the following types of information
regarding those served by the program:
   (1) The number.
   (2) The ethnic, geographic, and age breakdown.
   (3) The stages of presentation.
   (4) The diagnostic and treatment status.
   (g) The Breast Cancer Control Program shall be conducted in
consultation with the Breast Cancer Research Program created pursuant
to subparagraph (B) of paragraph (1) of subdivision (b).
   (h) In implementing the Breast Cancer Control Program, the State
Department of Public Health may appoint and consult with an advisory
panel appointed by the State Public Health Officer and consisting of
one ex officio, nonvoting member from the Breast Cancer Research
Program, breast cancer researchers, and representatives from
voluntary, nonprofit health organizations, health care professional
organizations, breast cancer survivor groups, and breast cancer and
health care-related advocacy groups. It is the intent of the
Legislature that breast cancer-related survivors and advocates and
health advocates for low-income women compose at least one-third of
the advisory panel. It is also the intent of the Legislature that the
State Department of Public Health collaborate closely with the
panel.
   (i) It is the intent of the Legislature in enacting the Breast
Cancer Control Program to decrease cancer mortality rates
attributable to breast cancer among uninsured and underinsured women,
with special emphasis on low-income, Native American, and minority
women. It is also the intent of the Legislature that the communities
served by the Breast Cancer Control Program reflect the ethnic,
racial, cultural, and geographic diversity of the state and that the
Breast Cancer Control Program fund entities where uninsured and
underinsured women are most likely to seek their health care.
   (j) The State Department of Public Health or any entity funded by
the Breast Cancer Control Program shall collect personal and medical
information necessary to administer this program from any individual
applying for services under the program. The information shall be
confidential and shall not be disclosed other than for purposes
directly connected with the administration of this program or except
as otherwise provided by law or pursuant to prior written consent of
the subject of the information.
   The State Department of Public Health or any entity funded by the
Breast Cancer Control Program may disclose the confidential
information to medical personnel and fiscal intermediaries of the
state to the extent necessary to administer this program, and to
other state public health agencies or medical researchers when the
confidential information is necessary to carry out the duties of
those agencies or researchers in the investigation, control, or
surveillance of breast cancer.
   (k) The State Department of Public Health shall adopt regulations
to implement this act in accordance with the rulemaking provisions of
the Administrative Procedure Act (Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code). The initial adoption of implementing regulations shall be
deemed an emergency and shall be considered as necessary for the
immediate preservation of the public peace, health and safety, or
general welfare, within the meaning of Section 11346.1 of the
Government Code. Emergency regulations adopted pursuant to this
section shall remain in effect for no more than 180 days.
   (l) It is the intent of the Legislature in enacting this section
that this section supersede and be operative in place of Section
30461.6 of the Revenue and Taxation Code as added by Chapter 660 of
the Statutes of 1993.
   (m) To implement the Breast Cancer Control Program, the State
Department of Public Health may contract, to the extent permitted by
Section 19130 of the Government Code, with public and private
entities, or utilize existing health care service provider enrollment
and payment mechanisms, including the Medi-Cal program's fiscal
intermediary. However, the Medi-Cal program's fiscal intermediary
shall only be utilized if services provided under the program are
specifically identified and reimbursed in a manner that does not
claim federal financial reimbursement. Any contracts with, and the
utilization of, the Medi-Cal program's fiscal intermediary shall not
be subject to Chapter 3 (commencing with Section 12100) of Part 2 of
Division 2 of the Public Contract Code. Contracts to implement the
Breast Cancer Control Program entered into by the State Department of
Public Health with entities other than the Medi-Cal program's fiscal
intermediary shall not be subject to Part 2 (commencing with Section
10100) of Division 2 of the Public Contract Code.
  SEC. 218.  Section 41007 of the Revenue and Taxation Code is
amended to read:
   41007.  (a) "Service supplier" shall mean both of the following:
   (1) A person supplying intrastate telephone communication services
to a service user in this state pursuant to California intrastate
tariffs and providing access to the "911" emergency system by
utilizing the digits 9-1-1.
   (2) A person supplying Voice over Internet Protocol (VoIP) service
to a service user in this state and providing access to the "911"
emergency system by utilizing the digits 9-1-1.
   (b) On and after January 1, 1988, "service supplier" also includes
a person supplying intrastate telephone communication services for
whom the Public Utilities Commission, by rule or order, modifies or
eliminates the requirement for that person to prepare and file
California intrastate tariffs.
  SEC. 219.  Section 41011 of the Revenue and Taxation Code is
amended to read:
   41011.  (a) "Charges for services" means all charges billed by a
service supplier to a service user for intrastate telephone
communication services and shall mean local telephone service and
include monthly service flat-rate charges for usage, message unit
charges and shall mean toll charges, and include intrastate wide area
telephone service charges and also means all charges billed by a
service supplier to a service user for VoIP service.
   (b) (1) "Charges for services" shall not include any tax imposed
by the United States or by any charter city, charges for service paid
by inserting coins in a public coin-operated telephone, and shall
not apply to amounts billed to nonsubscribers for coin shortages.
Where a coin-operated telephone service is furnished for a guarantee
or other periodic amount, such amount is subject to the surcharge
imposed by this part.
   (2) "Charges for services" shall not include charges for
intrastate toll calls where bills for such calls originate out of
California.
   (3) "Charges for services" shall not include charges for any
nonrecurring, installation, service connection or one-time charge for
service or directory advertising, and shall not include private
communication service charges, charges for other than communication
service, or any charge made by a hotel or motel for service rendered
in placing calls for its guests regardless of how such hotel or motel
charge is denominated or characterized by an applicable tariff of
the Public Utilities Commission of this state.
   (4) "Charges for services" shall not include charges for basic
exchange line service for lifeline services.
  SEC. 220.  Section 41030 of the Revenue and Taxation Code is
amended to read:
   41030.  The Department of General Services shall determine
annually, on or before October 1, a surcharge rate that it estimates
will produce sufficient revenue to fund the current fiscal year's
"911" costs. The surcharge rate shall be determined by dividing the
costs, including incremental costs, the Department of General
Services estimates for the current fiscal year of "911" plans
approved pursuant to Section 53115 of the Government Code, less the
available balance in the State Emergency Telephone Number Account in
the General Fund, by its estimate of the charges for intrastate
telephone communication services and VoIP service to which the
surcharge will apply for the period of January 1 to December 31,
inclusive, of the next succeeding calendar year, but in no event
shall the surcharge rate in any year be greater than three-quarters
of 1 percent nor less than one-half of 1 percent.
  SEC. 221.  Section 41136 of the Revenue and Taxation Code is
amended to read:
   41136.  Funds in the State Emergency Telephone Number Account
shall, when appropriated by the Legislature, be spent solely for the
following purposes:
   (a) A minimum of one-half of 1 percent of the charges for
intrastate telephone communications services and VoIP service to
which the surcharge applies, as follows:
   (1) To pay refunds authorized by this part.
   (2) To pay the State Board of Equalization for the cost of the
administration of this part.
   (3) To pay the office of the State Chief Information Officer for
its costs in administration of the "911" emergency telephone number
system.
   (4) To pay bills submitted to the office of the State Chief
Information Officer by service suppliers or communications equipment
companies for the installation of, and ongoing expenses for, the
following communications services supplied to local agencies in
connection with the "911" emergency phone number system:
   (A) A basic system.
   (B) A basic system with telephone central office identification.
   (C) A system employing automatic call routing.
   (D) Approved incremental costs.
   (5) To pay claims of local agencies for approved incremental
costs, not previously compensated for by another governmental agency.

   (6) To pay claims of local agencies for incremental costs and
amounts, not previously compensated for by another governmental
agency, incurred prior to the effective date of this part, for the
installation and ongoing expenses for the following communication
services supplied in connection with the "911" emergency telephone
number system:
   (A) A basic system.
   (B) A basic system with telephone central office identification.
   (C) A system employing automatic call routing.
   (D) Approved incremental costs. Incremental costs shall not be
allowed unless the costs are concurred in by the office of the State
Chief Information Officer.
   (b) (1) For the purposes of paragraph (5) of subdivision (a), the
term incremental costs shall include a maximum of one-quarter of 1
percent of the charges for intrastate telephone communications
services and VoIP service to which the surcharge applies for a
one-time payment to Primary Public Safety Answering Points for the
cost necessary to recruit and train additional personnel necessary to
accept wireless enhanced "911" calls from within their jurisdiction
routed directly to their call centers.
   (2) Funds allocated pursuant to this subdivision shall supplement,
and not supplant, existing funding for these services.
   (3) This subdivision shall remain in effect only until December
31, 2011.
  SEC. 222.  Section 149.9 of the Streets and Highways Code is
amended to read:
   149.9.  (a) Pursuant to Section 149.7 and the memorandum of
understanding between the Los Angeles County Metropolitan
Transportation Authority (LACMTA), the United States Department of
Transportation, and the department, as adopted on July 24, 2008, and
any subsequent, mutually agreed upon changes to that memorandum, the
LACMTA may operate a value-pricing and transit development
demonstration program involving high-occupancy toll (HOT) lanes to be
conducted, administered, developed, and operated on State Highway
Routes 10 and 110 in Los Angeles County by the LACMTA.
   (b) The LACMTA shall implement the program in cooperation with the
department and the active participation of the Department of the
California Highway Patrol, pursuant to a cooperative agreement that
addresses all matters related to design, construction, maintenance,
and operation of state highway system facilities in connection with
the value-pricing and transit program. With the consent of the
department, the board of the LACMTA shall establish appropriate
performance measures, such as speed or travel times, for the purpose
of ensuring optimal use of the HOT lanes without adversely affecting
other traffic on the state highway system.
   (c) The LACMTA and the department may implement the demonstration
program under the following conditions:
   (1) The value-pricing program may be operated on State Highway
Routes 10 and 110 in Los Angeles County on designated high-occupancy
vehicle (HOV) lanes.
   (2) (A) Single-occupant vehicles, or those vehicles that do not
meet minimum occupancy requirements, may be authorized to enter and
use the HOV lanes in the identified corridors, under conditions as
determined by the LACMTA.
   (B) The LACMTA may not change the vehicle occupancy requirement
for access to the HOV lanes in the identified corridors during the
demonstration period that is authorized under this section.
   (3) As part of the demonstration program, each proposed HOT lane
shall have nontolled alternative lanes available for public use in
the same corridor as the proposed HOT lanes.
   (4) The LACMTA shall implement a public outreach and
communications plan in order to solicit public input into the
development of the demonstration program.
   (5) In implementing the program, the LACMTA shall identify the
affected communities in the respective corridors and work with those
communities to identify impacts and develop mitigation measures.
   (6) The amount of the toll shall be established by the LACMTA, and
collected and administered in a manner determined by the LACMTA. The
LACMTA shall conduct a public hearing 30 days prior to setting or
increasing the toll.
   (7) The LACMTA shall assess the impacts of the program on
commuters of low income and shall provide mitigation to those
impacted commuters. Mitigation measures may include, but are not
limited to, reduced toll charges and toll credits for transit users.
Eligible commuters for reduced toll charges or toll credits for
transit users shall meet the eligibility requirements for assistance
programs under Chapter 2 (commencing with Section 11200) or Chapter 3
(commencing with Section 12000) of Part 3 of, Part 5 (commencing
with Section 17000) of, or Chapter 10 (commencing with Section
18900), Chapter 10.1 (commencing with Section 18930), or Chapter 10.3
(commencing with Section 18937) of Part 6 of, Division 9 of the
Welfare and Institutions Code.
   (8) Toll paying commuters shall have the option to purchase any
necessary toll paying equipment, prepay tolls, and renew toll
payments by cash or by using a credit card.
   (9) The LACMTA may operate the demonstration program until January
15, 2013, during which time it may not issue bonds for the
demonstration program.
   (10) The LACMTA and the department shall report to the Legislature
by December 31, 2012. The report shall include, but not be limited
to, a summary of the demonstration program, a survey of its users,
the impact on carpoolers, revenues generated, how transit service or
alternative modes of transportation were impacted, any potential
effect on traffic congestion in the HOV lane and in the neighboring
lanes, the number of toll-paying vehicles that utilized the HOT
lanes, any potential reductions in the greenhouse gas emissions that
are attributable to congestion reduction resulting from the HOT lane
demonstration project, and a description of the mitigation measures
on the affected communities and commuters in this demonstration
program.
   (11) Pursuant to Section 149.7, the revenue generated from the
program may be available to the LACMTA for the direct expenses
related to the maintenance, administration, and operation, including
collection and enforcement, of the demonstration program.
Administrative expenses shall not exceed 3 percent of the revenues.
   (12) All remaining revenue generated by the demonstration program
shall be used in the corridor from which the revenue was generated
exclusively for preconstruction, construction, and other related
costs of high-occupancy vehicle facilities and the improvement of
transit service in the corridor, including, but not limited to,
support for transit operations pursuant to an expenditure plan
adopted by the LACMTA.
   (13) This section shall not prevent the department or any local
agency from constructing facilities that compete with the HOT lane
demonstration project, and the LACMTA shall not be entitled to
compensation for adverse effects on toll revenue due to those
facilities.
  SEC. 223.  Section 30918 of the Streets and Highways Code is
amended to read:
   30918.  (a) It is the intention of the Legislature to maintain
tolls on all of the bridges specified in Section 30910 at rates
sufficient to meet any obligation to the holders of bonds secured by
the bridge toll revenues. The authority shall retain authority to set
the toll schedule as may be necessary to meet those bond
obligations. The authority shall provide at least 30 days' notice to
the transportation policy committee of each house of the Legislature
and shall hold a public hearing before adopting a toll schedule
reflecting the increased toll rate.
   (b) The authority shall increase the toll rates specified in the
adopted toll schedule in order to meet its obligations and covenants
under any bond resolution or indenture of the authority for any
outstanding toll bridge revenue bonds issued by the authority and the
requirements of any constituent instruments defining the rights of
holders of related obligations of the authority entered into pursuant
to Section 5922 of the Government Code and, notwithstanding Section
30887 or subdivision (c) of Section 30916 of this code, or any other
law, may increase the toll rates specified in the adopted toll
schedule to provide funds for the planning, design, construction,
operation, maintenance, repair, replacement, rehabilitation, and
seismic retrofit of the state-owned toll bridges specified in Section
30910 of this code, to provide funding to meet the requirements of
Sections 30884 and 30911 of this code, and to provide funding to meet
the requirements of voter-approved regional measures pursuant to
Sections 30914 and 30921 of this code.
   (c) The authority's toll structure for the state-owned toll
bridges specified in Section 30910 may vary from bridge to bridge and
may include discounts for vehicles classified by the authority as
high-occupancy vehicles, notwithstanding any other law.
   (d) If the authority establishes high-occupancy vehicle lane fee
discounts or access for vehicles classified by the authority as
high-occupancy vehicles for any bridge, the authority shall
collaborate with the department to reach agreement on how the
occupancy requirements shall apply on each segment of highway that
connects with that bridge.
   (e) All tolls referred to in this section and Sections 30916,
31010, and 31011 may be treated by the authority as a single revenue
source for accounting and administrative purposes and for the
purposes of any bond indenture or resolution and any agreement
entered into pursuant to Section 5922 of the Government Code.
   (f) It is the intent of the Legislature that the authority should
consider the needs and requirements of both its electronic and
cash-paying customers when it designates toll payment options at the
toll plazas for the toll bridges under its jurisdiction.
  SEC. 224.  Section 1611 of the Unemployment Insurance Code is
amended to read:
   1611.  Moneys in the Employment Training Fund shall be expended
only for the purposes of Chapter 3.5 (commencing with Section 10200)
of Part 1 of Division 3, and for the costs of administering this
article and Section 976.6, except those moneys may be used for any of
the following:
   (a) With the approval of the Legislature, the fund or
contributions to it may be used to pay interest charged on federal
loans to the Unemployment Fund.
   (b) Commencing with allocations made to the Employment Training
Panel in the 1992-93 fiscal year, any moneys allocated to the panel
in a fiscal year that are not encumbered by the panel in that fiscal
year shall revert to the Unemployment Insurance Fund.
   (c) It is the intent of the Legislature that the panel shall
closely monitor program performance and expenditures for employment
training programs administered by the panel, and that the panel shall
expeditiously disencumber funds that are not needed for employment
training program completion. Commencing with the 1992-93 fiscal year,
those moneys that are disencumbered during the fiscal year that are
not reencumbered during the same fiscal year shall revert to the
Unemployment Insurance Fund.
   (d) Notwithstanding any other law, the Controller may use the
moneys in the Employment Training Fund for loans to the General Fund
as provided in Sections 16310 and 16381 of the Government Code.
However, interest shall be paid on all moneys loaned to the General
Fund from the Employment Training Fund. Interest payable shall be
computed at a rate determined by the Pooled Money Investment Board to
be the current earning rate of the fund from which loaned. This
subdivision does not authorize any transfer that will interfere with
the carrying out of the object for which the Employment Training Fund
was created.
  SEC. 225.  Section 10214.6 of the Unemployment Insurance Code is
amended to read:
   10214.6.  (a) The panel shall establish the Partnership for
Workforce Recovery Training (PWRT) for the purposes of supporting and
implementing the workforce development goals set forth in the
federal American Recovery and Reinvestment Act of 2009 (ARRA) (P.L.
111-5). The panel shall develop and publish guidelines for
implementation of the PWRT, consistent with, and including adequate
fiscal and accounting controls, as prescribed in subdivision (g) of
Section 10205.
   (b) The panel may allocate any funds it receives pursuant to the
federal Workforce Investment Act of 1998 (29 U.S.C. Sec. 2801 et
seq.) and the ARRA to support the activities of the PWRT. Any funds
received by the panel pursuant to this section shall be deposited
into a separate account established by the department in the State
Treasury, and used for the purposes of this section.
   (c) The panel may adopt any regulations necessary to implement
this section, but any regulations so adopted are exempt from the
requirements of Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 of Title 2 of the Government Code.
   (d) The panel may solicit proposals and enter into contracts or
other agreements to secure funding for the purposes of this section,
but those proposals, contracts, and agreements shall be exempt from
any competitive bidding requirements otherwise prescribed in statute.

  SEC. 226.  Section 4465 of the Vehicle Code is amended to read:
   4465.  (a) A legal owner of record of a vehicle may request, and
the department shall furnish, information regarding the current
registration status of the vehicle, including the license plate
number and address of the registered owner of the vehicle. The
department may charge a fee to pay for the cost of furnishing this
information.
   (b) (1) By January 1, 2010, the department shall be in full
compliance with the federal Anti Car Theft Act of 1992 (P.L. 102-519)
and the United States Department of Justice (DOJ) rules governing
the federal National Motor Vehicle Title Information System (NMVTIS)
(49 U.S.C. Sec. 30501 et seq.), to the extent practicable.
   (2) Notwithstanding paragraph (1), by January 1, 2010, the
department shall eliminate any restrictions to consumer access to
titling, branding, and theft information provided by the department
to NMVTIS, to ensure that prospective purchasers have instant and
reliable access to California's data.
  SEC. 227.  Section 4466 of the Vehicle Code is amended to read:
   4466.  (a) The department shall not issue a duplicate or
substitute certificate of title or license plate if, after a search
of the records of the department, the registered owner's address, as
submitted on the application, is different from that which appears in
the records of the department, unless the registered owner applies
in person and presents all of the following:
   (1) Proof of ownership of the vehicle that is acceptable to the
department. Proof of ownership may be the certificate of title,
registration certificate, or registration renewal notice, or a
facsimile or photocopy of any of those documents, if the facsimile or
photocopy matches the vehicle record of the department.
   (2) A driver's license or identification card containing a picture
of the licensee or cardholder issued to the registered owner by the
department pursuant to Chapter 1 (commencing with Section 12500) of
Division 6. The department shall conduct a search of its records to
verify the authenticity of any document submitted under this
paragraph.
   (A) If the registered owner is a resident of another state or
country, the registered owner shall present a driver's license or
identification card issued by that state or country. In addition, the
registered owner shall provide photo documentation in the form of a
valid passport, military identification card, identification card
issued by a state or United States government agency, student
identification card issued by a college or university, or
identification card issued by a California-based employer. If a
resident of another state is unable to present the required photo
identification, the department shall verify the authenticity of the
driver's license or identification card by contacting the state that
issued the driver's license or identification card.
   (B) If the registered owner is not an individual, the person
submitting the application shall submit the photo identification
required pursuant to this paragraph, as well as documentation
acceptable to the department that demonstrates that the person is
employed by an officer of the registered owner.
   (3) If the application is for the purpose of replacing a license
plate that was stolen, a copy of a police report identifying the
plate as stolen.
   (4) If the application is for the purpose of replacing a
certificate of title or license plate that was mutilated or
destroyed, the remnants of the mutilated or destroyed document or
plate.
                                                                  (5)
If the department has a record of a prior issuance of a duplicate or
substitute certificate of title or license plate for the vehicle
within the past 90 days, a copy of a report from the Department of
the California Highway Patrol verifying the vehicle identification
number of the vehicle.
   (b) Subdivision (a) does not apply if any of the following
applies:
   (1) The registered owner's name, address, and driver's license or
identification card number submitted on the application match the
name, address, and driver's license or identification card number
contained in the department's records.
   (2) An application for a duplicate or substitute certificate of
title or license plate is submitted by or through one of the
following:
   (A) A legal owner, if the legal owner is not the same person as
the registered owner or as the lessee under Section 4453.5.
   (B) A dealer or an agent of the dealer.
   (C) A dismantler.
   (D) An insurer or an agent of the insurer.
   (E) A salvage pool.
   (c) At the discretion of the department, subdivision (a) does not
apply in any of the following circumstances:
   (1) An application for a duplicate or substitute certificate of
title or license plate is submitted by a licensed registration
service representing any of the following:
   (A) A person or entity listed in subparagraphs (A) to (E),
inclusive, of paragraph (2) of subdivision (b).
   (B) A business entity recognized under the laws of this state or
the laws of any foreign or domestic jurisdiction whose laws are in
parity with the laws of this state.
   (C) A court-appointed bankruptcy referee.
   (D) A person who is an individual, is not included in
subparagraphs (A) to (C), inclusive, and submits to the licensed
registration service an application with a signature that is
validated by a notary public. The licensed registration service shall
maintain full and complete records of its transactions conducted
pursuant to this subparagraph and shall make those records available
for inspection by an investigator of the Department of Motor
Vehicles, investigator of the Department of the California Highway
Patrol, a city police department, a county sheriff's office, or a
district attorney's office, if the investigator requests access to
the record and the request is for the purpose of a criminal
investigation.
   (2) The vehicle is registered under the International Registration
Plan pursuant to Section 8052 or under the Permanent Fleet
Registration program pursuant to Article 9.5 (commencing with Section
5301).
   (3) The vehicle is an implement of husbandry, as defined in
Section 36000, or a tow dolly, or has been issued an identification
plate under Section 5014 or 5014.1.
   (d) The department shall issue one or more license plates only to
the registered owner or lessee. The department shall issue the
certificate of title only to the legal owner, or if none, then to the
registered owner, as shown on the department's records.
  SEC. 228.  Section 11709.4 of the Vehicle Code is amended to read:
   11709.4.  (a) When a dealer purchases or obtains a vehicle in
trade in a retail sale or lease transaction and the vehicle is
subject to a prior credit or lease balance, all of the following
apply:
   (1) If the dealer agreed to pay a specified amount on the prior
credit or lease balance owing on the vehicle purchased or obtained in
trade, and the agreement to pay the specified amount is contained in
a written agreement documenting the transaction, the dealer shall
tender the agreed upon amount as provided in the written agreement to
the lessor registered in accordance with Section 4453.5, or to the
legal owner reflected on the ownership certificate, or to the
designee of that lessor or legal owner of the vehicle purchased or
obtained in trade within 21 calendar days of purchasing or obtaining
the vehicle in trade.
   (2) If the dealer did not set forth an agreement regarding payment
of a prior credit or lease balance owed on the vehicle purchased or
obtained in trade, in a written agreement documenting the
transaction, the dealer shall tender to the lessor registered in
accordance with Section 4453.5, or to the legal owner reflected on
the ownership certificate, or to the designee of that lessor or legal
owner of the vehicle purchased or obtained in trade, an amount
necessary to discharge the prior credit or lease balance owing on the
vehicle purchased or obtained in trade within 21 calendar days of
purchasing or obtaining the vehicle in trade.
   (3) The time period specified in paragraph (1) or (2) may be
shortened if the dealer and consumer agree, in writing, to a shorter
time period.
   (4) A dealer shall not sell, consign for sale, or transfer any
ownership interest in the vehicle purchased or obtained in trade
until an amount necessary to discharge the prior credit or lease
balance owing on the vehicle has been tendered to the lessor
registered in accordance with Section 4453.5, or to the legal owner
reflected on the ownership certificate, or to the designee of that
lessor or legal owner of the vehicle purchased or obtained in trade.
   (b) A dealer does not violate this section if the dealer
reasonably and in good faith gives notice of rescission of the
contract promptly, but no later than 21 days after the date on which
the vehicle was purchased or obtained in trade, and the contract is
thereafter rescinded on any of the grounds in Section 1689 of the
Civil Code.
  SEC. 229.  Section 13386 of the Vehicle Code is amended to read:
   13386.  (a) (1) The Department of Motor Vehicles shall certify or
cause to be certified ignition interlock devices required by Article
5 (commencing with Section 23575) of Chapter 2 of Division 11.5 and
publish a list of approved devices.
   (2) (A) The Department of Motor Vehicles shall ensure that
ignition interlock devices that have been certified according to the
requirements of this section continue to meet certification
requirements. The department may periodically require manufacturers
to indicate in writing whether the devices continue to meet
certification requirements.
   (B) The department may use denial of certification, suspension or
revocation of certification, or decertification of an ignition
interlock device in another state as an indication that the
certification requirements are not met, if either of the following
apply:
   (i) The denial of certification, suspension or revocation of
certification, or decertification in another state constitutes a
violation by the manufacturer of Article 2.55 (commencing with
Section 125.00) of Chapter 1 of Division 1 of Title 13 of the
California Code of Regulations.
   (ii) The denial of certification for an ignition interlock device
in another state was due to a failure of an ignition interlock device
to meet the standards adopted by the regulation set forth in clause
(i), specifically Sections 1 and 2 of the model specification for
breath alcohol ignition interlock devices, as published by notice in
the Federal Register, Vol. 57, No. 67, Tuesday, April 7, 1992, on
pages 11774 to 11787, inclusive.
   (C) Failure to continue to meet certification requirements shall
result in suspension or revocation of certification of ignition
interlock devices.
   (b) (1) A manufacturer shall not furnish an installer, service
center, technician, or consumer with technology or information that
allows a device to be used in a manner that is contrary to the
purpose for which it is certified.
   (2) Upon a violation of paragraph (1), the department shall
suspend or revoke the certification of the ignition interlock device
that is the subject of that violation.
   (c) An installer, service center, or technician shall not tamper
with, change, or alter the functionality of the device from its
certified criteria.
   (d) The department shall utilize information from an independent
laboratory to certify ignition interlock devices on or off the
premises of the manufacturer or manufacturer's agent, in accordance
with the guidelines. The cost of certification shall be borne by the
manufacturers of ignition interlock devices. If the certification of
a device is suspended or revoked, the manufacturer of the device
shall be responsible for, and shall bear the cost of, the removal of
the device and the replacement of a certified device of the
manufacturer or another manufacturer.
   (e) No model of ignition interlock device shall be certified
unless it meets the accuracy requirements and specifications provided
in the guidelines adopted by the National Highway Traffic Safety
Administration.
   (f) All manufacturers of ignition interlock devices that meet the
requirements of subdivision (e) and are certified in a manner
approved by the Department of Motor Vehicles, who intend to market
the devices in this state, first shall apply to the Department of
Motor Vehicles on forms provided by that department. The application
shall be accompanied by a fee in an amount not to exceed the amount
necessary to cover the costs incurred by the department in carrying
out this section.
   (g) A manufacturer and a manufacturer's agent certified by the
department to provide ignition interlock devices shall provide each
year to the department information on the number of false positives
and the time to reset the device. The department shall use this
information in evaluating the continued certification of an ignition
interlock device.
   (h) The department shall ensure that standard forms and procedures
are developed for documenting decisions and compliance and
communicating results to relevant agencies. These forms shall include
all of the following:
   (1) An "Option to Install," to be sent by the Department of Motor
Vehicles to repeat offenders along with the mandatory order of
suspension or revocation. This shall include the alternatives
available for early license reinstatement with the installation of an
ignition interlock device and shall be accompanied by a toll-free
telephone number for each manufacturer of a certified ignition
interlock device. Information regarding approved installation
locations shall be provided to drivers by manufacturers with ignition
interlock devices that have been certified in accordance with this
section.
   (2) A "Verification of Installation" to be returned to the
department by the reinstating offender upon application for
reinstatement. Copies shall be provided for the manufacturer or the
manufacturer's agent.
   (3) A "Notice of Noncompliance" and procedures to ensure continued
use of the ignition interlock device during the restriction period
and to ensure compliance with maintenance requirements. The
maintenance period shall be standardized at 60 days to maximize
monitoring checks for equipment tampering.
   (i) Every manufacturer and manufacturer's agent certified by the
department to provide ignition interlock devices shall adopt fee
schedules that provide for the payment of the costs of the device by
applicants in amounts commensurate with the applicant's ability to
pay.
  SEC. 230.  Section 21455.5 of the Vehicle Code is amended to read:
   21455.5.  (a) The limit line, the intersection, or a place
designated in Section 21455, where a driver is required to stop, may
be equipped with an automated enforcement system if the governmental
agency utilizing the system meets all of the following requirements:
   (1) Identifies the system by signs that clearly indicate the
system's presence and are visible to traffic approaching from all
directions, or posts signs at all major entrances to the city,
including, at a minimum, freeways, bridges, and state highway routes.

   (2) If it locates the system at an intersection, and ensures that
the system meets the criteria specified in Section 21455.7.
   (b) Prior to issuing citations under this section, a local
jurisdiction utilizing an automated traffic enforcement system shall
commence a program to issue only warning notices for 30 days. The
local jurisdiction shall also make a public announcement of the
automated traffic enforcement system at least 30 days prior to the
commencement of the enforcement program.
   (c) Only a governmental agency, in cooperation with a law
enforcement agency, may operate an automated enforcement system. As
used in this subdivision, "operate" includes all of the following
activities:
   (1) Developing uniform guidelines for screening and issuing
violations and for the processing and storage of confidential
information, and establishing procedures to ensure compliance with
those guidelines.
   (2) Performing administrative functions and day-to-day functions,
including, but not limited to, all of the following:
   (A) Establishing guidelines for selection of location.
   (B) Ensuring that the equipment is regularly inspected.
   (C) Certifying that the equipment is properly installed and
calibrated, and is operating properly.
   (D) Regularly inspecting and maintaining warning signs placed
under paragraph (1) of subdivision (a).
   (E) Overseeing the establishment or change of signal phases and
the timing thereof.
   (F) Maintaining controls necessary to assure that only those
citations that have been reviewed and approved by law enforcement are
delivered to violators.
   (d) The activities listed in subdivision (c) that relate to the
operation of the system may be contracted out by the governmental
agency, if it maintains overall control and supervision of the
system. However, the activities listed in paragraph (1) of, and
subparagraphs (A), (D), (E), and (F) of paragraph (2) of, subdivision
(c) may not be contracted out to the manufacturer or supplier of the
automated enforcement system.
   (e) (1) Notwithstanding Section 6253 of the Government Code, or
any other provision of law, photographic records made by an automated
enforcement system shall be confidential, and shall be made
available only to governmental agencies and law enforcement agencies
and only for the purposes of this article.
   (2) Confidential information obtained from the Department of Motor
Vehicles for the administration or enforcement of this article shall
be held confidential, and may not be used for any other purpose.
   (3) Except for court records described in Section 68152 of the
Government Code, the confidential records and information described
in paragraphs (1) and (2) may be retained for up to six months from
the date the information was first obtained, or until final
disposition of the citation, whichever date is later, after which
time the information shall be destroyed in a manner that will
preserve the confidentiality of any person included in the record or
information.
   (f) Notwithstanding subdivision (e), the registered owner or any
individual identified by the registered owner as the driver of the
vehicle at the time of the alleged violation shall be permitted to
review the photographic evidence of the alleged violation.
   (g) (1) A contract between a governmental agency and a
manufacturer or supplier of automated enforcement equipment may not
include provision for the payment or compensation to the manufacturer
or supplier based on the number of citations generated, or as a
percentage of the revenue generated, as a result of the use of the
equipment authorized under this section.
   (2) Paragraph (1) does not apply to a contract that was entered
into by a governmental agency and a manufacturer or supplier of
automated enforcement equipment before January 1, 2004, unless that
contract is renewed, extended, or amended on or after January 1,
2004.
  SEC. 231.  Section 27602 of the Vehicle Code is amended to read:
   27602.  (a) A person shall not drive a motor vehicle if a
television receiver, a video monitor, or a television or video
screen, or any other similar means of visually displaying a
television broadcast or video signal that produces entertainment or
business applications, is operating and is located in the motor
vehicle at a point forward of the back of the driver's seat, or is
operating and the monitor, screen, or display is visible to the
driver while driving the motor vehicle.
   (b) Subdivision (a) does not apply to the following equipment when
installed in a vehicle:
   (1) A vehicle information display.
   (2) A global positioning display.
   (3) A mapping display.
   (4) A visual display used to enhance or supplement the driver's
view forward, behind, or to the sides of a motor vehicle for the
purpose of maneuvering the vehicle.
   (5) A television receiver, video monitor, television or video
screen, or any other similar means of visually displaying a
television broadcast or video signal, if that equipment satisfies one
of the following requirements:
   (A) The equipment has an interlock device that, when the motor
vehicle is driven, disables the equipment for all uses except as a
visual display as described in paragraphs (1) to (4), inclusive.
   (B) The equipment is designed, operated, and configured in a
manner that prevents the driver of the motor vehicle from viewing the
television broadcast or video signal while operating the vehicle in
a safe and reasonable manner.
   (6) A mobile digital terminal that is fitted with an opaque
covering that does not allow the driver to view any part of the
display while driving, even though the terminal may be operating,
installed in a vehicle that is owned or operated by any of the
following:
   (A) An electrical corporation, as defined in Section 218 of the
Public Utilities Code.
   (B) A gas corporation, as defined in Section 222 of the Public
Utilities Code.
   (C) A sewer system corporation, as defined in Section 230.6 of the
Public Utilities Code.
   (D) A telephone corporation, as defined in Section 234 of the
Public Utilities Code.
   (E) A water corporation, as defined in Section 241 of the Public
Utilities Code.
   (F) A local publicly owned electric utility, as defined in Section
224.3 of the Public Utilities Code.
   (G) A city, joint powers agency, or special district, if that
local entity uses the vehicle solely in the provision of sewer
service, gas service, water service, or wastewater service.
   (c) Subdivision (a) does not apply to a mobile digital terminal
installed in an authorized emergency vehicle or to a motor vehicle
providing emergency road service or roadside assistance.
   (d) Subdivision (a) does not apply to a mobile digital terminal
installed in a vehicle when the vehicle is deployed in an emergency
to respond to an interruption or impending interruption of
electrical, natural gas, telephone, sewer, water, or wastewater
service, and the vehicle is owned or operated by any of the
following:
   (1) An electrical corporation, as defined in Section 218 of the
Public Utilities Code.
   (2) A gas corporation, as defined in Section 222 of the Public
Utilities Code.
   (3) A sewer system corporation, as defined in Section 230.6 of the
Public Utilities Code.
   (4) A telephone corporation, as defined in Section 234 of the
Public Utilities Code.
   (5) A water corporation, as defined in Section 241 of the Public
Utilities Code.
   (6) A local publicly owned electric utility, as defined in Section
224.3 of the Public Utilities Code.
   (7) A city, joint powers agency, or special district, if that
local entity uses the vehicle solely in the provision of sewer
service, gas service, water service, or wastewater service.
  SEC. 232.  Section 40002 of the Vehicle Code is amended to read:
   40002.  (a) (1) If there is a violation of Section 40001, an owner
or any other person subject to Section 40001, who was not driving
the vehicle involved in the violation, may be mailed a written notice
to appear. An exact and legible duplicate copy of that notice when
filed with the court, in lieu of a verified complaint, is a complaint
to which the defendant may plead "guilty."
   (2) If, however, the defendant fails to appear in court or does
not deposit lawful bail, or pleads other than "guilty" of the offense
charged, a verified complaint shall be filed which shall be deemed
to be an original complaint, and thereafter proceedings shall be had
as provided by law, except that a defendant may, by an agreement in
writing, subscribed by the defendant and filed with the court, waive
the filing of a verified complaint and elect that the prosecution may
proceed upon a written notice to appear.
   (3) A verified complaint pursuant to paragraph (2) shall include a
paragraph that informs the person that unless he or she appears in
the court designated in the complaint within 21 days after being
given the complaint and answers the charge, renewal of registration
of the vehicle involved in the offense may be precluded by the
department, or a warrant of arrest may be issued against him or her.
   (b) (1) If a person mailed a notice to appear pursuant to
paragraph (1) of subdivision (a) fails to appear in court or deposit
bail, a warrant of arrest shall not be issued based on the notice to
appear, even if that notice is verified. An arrest warrant may be
issued only after a verified complaint pursuant to paragraph (2) of
subdivision (a) is given the person and the person fails to appear in
court to answer that complaint.
   (2) If a person mailed a notice to appear pursuant to paragraph
(1) of subdivision (a) fails to appear in court or deposit bail, the
court may give by mail to the person a notice of noncompliance. A
notice of noncompliance shall include a paragraph that informs the
person that unless he or she appears in the court designated in the
notice to appear within 21 days after being given by mail the notice
of noncompliance and answers the charge on the notice to appear, or
pays the applicable fine and penalties if an appearance is not
required, renewal of registration of the vehicle involved in the
offense may be precluded by the department.
   (c) A verified complaint filed pursuant to this section shall
conform to Chapter 2 (commencing with Section 948) of Title 5 of Part
2 of the Penal Code.
   (d) (1) The giving by mail of a notice to appear pursuant to
paragraph (1) of subdivision (a) or a notice of noncompliance
pursuant to paragraph (2) of subdivision (b) shall be done in a
manner prescribed by Section 22.
   (2) The verified complaint pursuant to paragraph (2) of
subdivision (a) shall be given in a manner prescribed by Section 22.
  SEC. 233.  Section 42001.13 of the Vehicle Code is amended to read:

   42001.13.  (a) A person who commits a violation of Section 22507.8
is subject to either a civil notice of parking violation pursuant to
Article 3 (commencing with Section 40200) of Chapter 1 of Division
17 or a criminal notice to appear.
   (b) If a notice to appear is issued and upon conviction of an
infraction for a violation of Section 22507.8, a person shall be
punished as follows:
   (1) A fine of not less than two hundred fifty dollars ($250) and
not more than five hundred dollars ($500) for the first offense.
   (2) A fine of not less than five hundred dollars ($500) and not
more than seven hundred fifty dollars ($750) for the second offense.
   (3) A fine of not less than seven hundred fifty dollars ($750) and
not more than one thousand dollars ($1,000) for three or more
offenses.
   (c) The court may suspend the imposition of the fine if the person
convicted possessed at the time of the offense, but failed to
display, a valid special identification license plate issued pursuant
to Section 5007 or a distinguishing placard issued pursuant to
Section 22511.55 or 22511.59.
   (d) A fine imposed under this section may be paid in installments
if the court determines that the defendant is unable to pay the
entire amount in one payment.
  SEC. 234.  Section 10608.24 of the Water Code is amended to read:
   10608.24.  (a) Each urban retail water supplier shall meet its
interim urban water use target by December 31, 2015.
   (b) Each urban retail water supplier shall meet its urban water
use target by December 31, 2020.
   (c) An urban retail water supplier's compliance daily per capita
water use shall be the measure of progress toward achievement of its
urban water use target.
   (d) (1) When determining compliance daily per capita water use, an
urban retail water supplier may consider the following factors:
   (A) Differences in evapotranspiration and rainfall in the baseline
period compared to the compliance reporting period.
   (B) Substantial changes to commercial or industrial water use
resulting from increased business output and economic development
that have occurred during the reporting period.
   (C) Substantial changes to institutional water use resulting from
fire suppression services or other extraordinary events, or from new
or expanded operations, that have occurred during the reporting
period.
   (2) If the urban retail water supplier elects to adjust its
estimate of compliance daily per capita water use due to one or more
of the factors described in paragraph (1), it shall provide the basis
for, and data supporting, the adjustment in the report required by
Section 10608.40.
   (e) When developing the urban water use target pursuant to Section
10608.20, an urban retail water supplier that has a substantial
percentage of industrial water use in its service area may exclude
process water from the calculation of gross water use to avoid a
disproportionate burden on another customer sector.
   (f) (1) An urban retail water supplier that includes agricultural
water use in an urban water management plan pursuant to Part 2.6
(commencing with Section 10610) may include the agricultural water
use in determining gross water use. An urban retail water supplier
that includes agricultural water use in determining gross water use
and develops its urban water use target pursuant to paragraph (2) of
subdivision (b) of Section 10608.20 shall use a water efficient
standard for agricultural irrigation of 100 percent of reference
evapotranspiration multiplied by the crop coefficient for irrigated
acres.
   (2) An urban retail water supplier, that is also an agricultural
water supplier, is not subject to the requirements of Chapter 4
(commencing with Section 10608.48), if the agricultural water use is
incorporated into its urban water use target pursuant to paragraph
(1).
  SEC. 235.  Section 10608.44 of the Water Code is amended to read:
   10608.44.  Each state agency shall reduce water use at facilities
it operates to support urban retail water suppliers in meeting the
target identified in Section 10608.16.
  SEC. 236.  Section 10853 of the Water Code is amended to read:
   10853.  An agricultural water supplier that provides water to less
than 25,000 irrigated acres, excluding recycled water, shall not be
required to implement the requirements of this part or Part 2.55
(commencing with Section 10608) unless sufficient funding has
specifically been
provided to that water supplier for these purposes.
  SEC. 237.  Section 10933 of the Water Code is amended to read:
   10933.  (a) On or before January 1, 2012, the department shall
commence to identify the extent of monitoring of groundwater
elevations that is being undertaken within each basin and subbasin.
   (b) The department shall prioritize groundwater basins and
subbasins for the purpose of implementing this section. In
prioritizing the basins and subbasins, the department shall, to the
extent data are available, consider all of the following:
   (1) The population overlying the basin or subbasin.
   (2) The rate of current and projected growth of the population
overlying the basin or subbasin.
   (3) The number of public supply wells that draw from the basin or
subbasin.
   (4) The total number of wells that draw from the basin or
subbasin.
   (5) The irrigated acreage overlying the basin or subbasin.
   (6) The degree to which persons overlying the basin or subbasin
rely on groundwater as their primary source of water.
   (7) Any documented impacts on the groundwater within the basin or
subbasin, including overdraft, subsidence, saline intrusion, and
other water quality degradation.
   (8) Any other information determined to be relevant by the
department.
   (c) If the department determines that all or part of a basin or
subbasin is not being monitored pursuant to this part, the department
shall do all of the following:
   (1) Attempt to contact all well owners within the area not being
monitored.
   (2) Determine if there is an interest in establishing any of the
following:
   (A) A groundwater management plan pursuant to Part 2.75
(commencing with Section 10750).
   (B) An integrated regional water management plan pursuant to Part
2.2 (commencing with Section 10530) that includes a groundwater
management component that complies with the requirements of Section
10753.7.
   (C) A voluntary groundwater monitoring association pursuant to
Section 10935.
   (d) If the department determines that there is sufficient interest
in establishing a plan or association described in paragraph (2) of
subdivision (c), or if the county agrees to perform the groundwater
monitoring functions in accordance with this part, the department
shall work cooperatively with the interested parties to comply with
the requirements of this part within two years.
   (e) If the department determines, with regard to a basin or
subbasin, that there is insufficient interest in establishing a plan
or association described in paragraph (2) of subdivision (c), and if
the county decides not to perform the groundwater monitoring and
reporting functions of this part, the department shall do all of the
following:
   (1) Identify any existing monitoring wells that overlie the basin
or subbasin that are owned or operated by the department or any other
state or federal agency.
   (2) Determine whether the monitoring wells identified pursuant to
paragraph (1) provide sufficient information to demonstrate seasonal
and long-term trends in groundwater elevations.
   (3) If the department determines that the monitoring wells
identified pursuant to paragraph (1) provide sufficient information
to demonstrate seasonal and long-term trends in groundwater
elevations, the department shall not perform groundwater monitoring
functions pursuant to Section 10933.5.
   (4) If the department determines that the monitoring wells
identified pursuant to paragraph (1) provide insufficient information
to demonstrate seasonal and long-term trends in groundwater
elevations, and the State Mining and Geology Board concurs with that
determination, the department shall perform groundwater monitoring
functions pursuant to Section 10933.5.
  SEC. 238.  Section 12645 of the Water Code is amended to read:
   12645.  The Legislature finds and declares all of the following:
   (a) In 1911, the Legislature adopted a flood control plan for the
Sacramento Valley, as proposed by the federal California Debris
Commission, and created the Reclamation Board to regulate levees and
other encroachments, and to review and approve flood control plans
for the Sacramento River and its tributaries. The state's adoption of
a valleywide flood management plan was intended to create a unified
plan of flood control and to reclaim lands from overflow. Six years
later, California gained congressional authorization for the United
States Army Corps of Engineers (Corps) to collaborate with the state
in building and maintaining the Sacramento River Flood Control
Project. The federal government transferred completed portions of the
Sacramento River Flood Control Project to the state as portions were
completed, and the state, in turn, passed responsibility for
operation and maintenance to local districts organized to provide
flood control within their boundaries.
   (b) The state and federal governments have built or rebuilt
levees, weirs, and bypasses to increase conveyance of flood waters
downstream. The Sacramento River Flood Control Project and the
federal-state flood control project in the San Joaquin Valley include
approximately 1,600 miles of levees and other facilities to reduce
central valley flood risk, now defined as the State Plan of Flood
Control in subdivision (j) of Section 5096.805 of the Public
Resources Code. The Corps often constructed federal "project levees"
in both the Sacramento and San Joaquin River watersheds by modifying
existing levees. The federal government transferred completed
portions of the Sacramento River Flood Control Project to the state,
as portions were completed, which in turn passed responsibility for
operation and maintenance to local reclamation districts.
   (c) In 2003, a state Court of Appeal in Paterno v. State of
California (2003) 113 Cal.App.4th 998 (Paterno), held the state
liable, in a claim for inverse condemnation, for failure of a levee
that was operated and maintained by a local levee maintenance
district. In settlement of that litigation, the state's liability was
substantial because homes and a shopping center were built behind
the levee and suffered from the resulting flood.
   (d) The Legislature has authorized funding for numerous flood
control projects throughout the Sacramento and San Joaquin River
watersheds. These statutory authorizations included varying
provisions regarding responsibility and liability for operation and
maintenance of the flood control facilities, and may or may not have
incorporated the specified facilities into the federal-state
Sacramento River or San Joaquin River flood control projects. After
the court ruling in Paterno, the status of each flood facility became
critically important to determining liability, and legal ambiguities
led to questions about whether particular facilities were
incorporated into a federal-state flood control project. In some
cases, despite a location between two project levees, certain levees
remain outside the jurisdiction of a federal-state flood control
project, with local agencies retaining liability.
   (e) In 2006, California voters approved the Disaster Preparedness
and Flood Prevention Bond Act of 2006, which authorized the issuance
of general obligation bonds in the amount of $4.9 billion for flood
protection and defined the Sacramento River and San Joaquin River
federal-state flood control projects as the "State Plan of Flood
Control." The following year, the Legislature passed a package of
bills to reform state flood protection policy in the central valley.
These laws required the Department of Water Resources to develop, and
the Central Valley Flood Protection Board to adopt, a Central Valley
Flood Protection Plan, which is broader than the State Plan of Flood
Control, affecting the entire watersheds of the Sacramento and San
Joaquin Valley. These laws included provisions intended to limit
state liability to facilities identified in the State Plan of Flood
Control. These laws did not specifically address the facilities
described in this article.
  SEC. 239.  Section 12647 of the Water Code is amended to read:
   12647.  (a) The state shall not have responsibility or liability
for the construction, operation, and maintenance of central valley
flood control facilities identified in this article unless all of the
following apply:
   (1) The department identifies the facility as part of the State
Plan of Flood Control.
   (2) The state has expressly accepted the transfer of liability for
the facility from the federal government.
   (3) The board incorporates the facility into the State Plan of
Flood Control pursuant to Section 9611.
   (b) Unless otherwise specifically provided, nothing in this
article shall be construed to expand the responsibility of the state
for the operation or maintenance of any flood management facility
outside the scope of the State Plan of Flood Control, except as
specifically determined by the board pursuant to Section 9611.
   (c) Use of the phrase "adopted and authorized" in this article
does not, by itself, reflect incorporation of the specified facility
into the State Plan of Flood Control or assumption of liability by
the state, unless one of the conditions described in subdivision (a)
applies to the facility.
   (d) Nothing in this section abrogates or modifies any duty,
responsibility, or liability of any federal, state, or local agency,
including, but not limited to, those duties, responsibilities, and
liabilities set forth in Sections 8370, 12642, and 12828.
  SEC. 240.  Section 30779 of the Water Code is amended to read:
   30779.  The ballots shall contain the list of names and the
respective offices as published in the proclamation and shall be in
substantially the following form:


       General (or Special) Water District Election, ____ County
Water District
(Inserting date thereof).


   Instructions to Voters: To vote, stamp or write a cross (+)
opposite the name of the candidate for whom you desire to vote. All
marks otherwise made are forbidden. All distinguishing marks are
forbidden and make the ballot void. If you wrongly mark, tear, or
deface this ballot, return it to the inspector of elections and
obtain another.

  SEC. 241.  Section 4691 of the Welfare and Institutions Code is
amended to read:
   4691.  (a) The Legislature reaffirms its intent that
community-based day programs be planned and provided as part of a
continuum of services to enable persons with developmental
disabilities to approximate the pattern of everyday living available
to people of the same age without disabilities. The Legislature
further intends that standards be developed to ensure high-quality
services, and that equitable ratesetting procedures based upon those
standards be established, maintained, and revised, as necessary. The
Legislature intends that ratesetting procedures be developed for all
community-based day programs, which include adult development
centers, activity centers, infant day programs, behavior management
programs, social recreational programs, and independent living
programs.
   (b) For the purpose of ensuring that regional centers may secure
high-quality services for persons with developmental disabilities,
the State Department of Developmental Services shall promulgate
regulations establishing program standards and an equitable process
for setting rates of state payment for community-based day programs.
These regulations shall include, but are not limited to, all of the
following:
   (1) The standards and requirements related to the operation of the
program including, but not limited to, staff qualifications,
staff-to-client ratios, client entrance and exit criteria, program
design, program evaluation, program and client records and
documentation, client placement, and personnel requirements and
functions.
   (2) The allowable cost components of the program including salary
and wages, staff benefits, operating expenses, and management
organization costs where two or more programs are operated by a
separate and distinct corporation or entity.
   (3) The rate determination processes for establishing rates, based
on the allowable costs of the allowable cost components. Different
rate determination processes may be developed for establishing rates
for new and existing programs, and for the initial and subsequent
years of implementation of the regulations. The processes shall
include, but are not limited to, all of the following:
   (A) The procedure for identification and grouping of programs by
type of day program and approved staff-to-client ratio.
   (B) The requirements for an identification of the program, cost,
and other information, if any, which the program is required to
submit to the department or the regional center, the consequences, if
any, for failure to do so, and the timeframes and format for
submission and review.
   (C) The ratesetting methodology.
   (D) A procedure for adjusting rates as a result of anticipated and
unanticipated program changes and fiscal audits of the program and a
procedure for appealing rates, including the timeframes for the
program to request an adjustment or appeal, and for the department to
respond.
   (E) A procedure for increasing established rates and the allowable
range of rates due to cost-of-living adjustments.
   (F) A procedure for increasing established rates as a result of
Budget Act appropriations made pursuant to the ratesetting
methodology established pursuant to Section 4691.5 and subdivision
(c) of this section.
   The department shall develop these regulations in consultation
with representatives from organizations representing the
developmental services system as determined by the department. The
State Council on Developmental Disabilities, and other organizations
representing regional centers, providers, and clients shall have an
opportunity to review and comment upon the proposed regulations prior
to their promulgation. The department shall promulgate these
regulations for all community-based day programs by July 1, 1990.
   (c) Upon the promulgation of regulations pursuant to subdivision
(b), and pursuant to Section 4691.5, and by September 1 of each year
thereafter, the department shall establish rates pursuant to the
regulations. Rate increases during the 1990-91 and 1991-92 fiscal
years shall be limited to those specified in subdivision (b). For the
1992-93 fiscal year and all succeeding fiscal years, any increases
proposed during those years in the rates of reimbursement established
pursuant to the regulations, except for rate increases due to rate
appeals and rate adjustments based on unanticipated program changes,
shall be subject to the appropriation of sufficient funds in the
Budget Act, for those purposes, to fully provide the proposed
increase to all eligible programs for the entire fiscal year. If the
funds appropriated in the Budget Act are not sufficient to fully
provide for the proposed increase in the rates of reimbursement for
all eligible programs for the entire fiscal year, the proposed
increase shall be limited to the level of funds appropriated. The
increases proposed in the rates of reimbursement shall be reduced
equitably among all eligible providers in accordance with funds
appropriated and the eligible programs shall be reimbursed at the
reduced amount for the entire fiscal year.
   (d) Using the reported costs of day programs reimbursed at a
permanent rate and the standards and ratesetting processes
promulgated pursuant to subdivision (b) as a basis, the department
shall report to the Legislature as follows:
   (1) By April 15, 1993, and every odd year thereafter, the
difference between permanent rates for existing programs and the
rates of those programs based upon their allowable costs and client
attendance, submitted pursuant to the regulations specified in
subdivision (b). In reporting the difference, the department shall
also identify the amount of the difference associated with programs
whose rates are above the allowable range of rates, which is
available for increasing the rates of programs whose rates are below
the allowable range, to within the allowable range, and any other
pertinent cost or rate information which the department deems
necessary.
   (2) By April 15, 1994, and every even year thereafter, the level
of funding, if any, which was not appropriated to reimburse providers
at the proposed rates reported the prior fiscal year pursuant to
paragraph (1), and any other pertinent cost or rate information which
the department deems necessary.
   (3) The April 15, 1996, report pursuant to paragraph (2) shall be
prepared jointly by the department and organizations representing
community-based day program providers, as determined by the
department. That report shall also include a review of the
ratesetting process and recommendations, if any, for its
modification.
   (e) Rates established by the department pursuant to subdivision
(b) are exempt from the provisions of Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code.
   (f) The department shall ensure that the regional centers monitor
compliance with program standards.
  SEC. 242.  Section 4860 of the Welfare and Institutions Code is
amended to read:
   4860.  (a) (1) The hourly rate for supported employment services
provided to consumers receiving individualized services shall be
thirty dollars and eighty-two cents ($30.82).
   (2) Job coach hours spent in travel to consumer worksites may be
reimbursable for individualized services only when the job coach
travels from the vendor's headquarters to the consumer's worksite or
from one consumer's worksite to another, and only when the travel is
one way.
   (b) The hourly rate for group services shall be thirty dollars and
eighty-two cents ($30.82), regardless of the number of consumers
served in the group. Consumers in a group shall be scheduled to start
and end work at the same time, unless an exception that takes into
consideration the consumer's compensated work schedule is approved in
advance by the regional center. The department, in consultation with
stakeholders, shall adopt regulations to define the appropriate
grounds for granting these exceptions. When the number of consumers
in a supported employment placement group drops to fewer than the
minimum required in subdivision (r) of Section 4851, the regional
center may terminate funding for the group services in that group,
unless, within 90 days, the program provider adds one or more
regional centers, or Department of Rehabilitation-funded supported
employment consumers to the group.
   (c) Job coaching hours for group services shall be allocated on a
prorated basis between a regional center and the Department of
Rehabilitation when regional center and Department of Rehabilitation
consumers are served in the same group.
   (d) When Section 4855 applies, fees shall be authorized for the
following:
   (1) A three-hundred-sixty-dollar ($360) fee shall be paid to the
program provider upon intake of a consumer into a supported
employment program. No fee shall be paid if that consumer completed a
supported employment intake process with that same supported
employment program within the previous 12 months.
   (2) A seven-hundred-twenty-dollar ($720) fee shall be paid upon
placement of a consumer in an integrated job, except that no fee
shall be paid if that consumer is placed with another consumer or
consumers assigned to the same job coach during the same hours of
employment.
   (3) A seven-hundred-twenty-dollar ($720) fee shall be paid after a
90-day retention of a consumer in a job, except that no fee shall be
paid if that consumer has been placed with another consumer or
consumers, assigned to the same job coach during the same hours of
employment.
   (e) Notwithstanding paragraph (4) of subdivision (a) of Section
4648, the regional center shall pay the supported employment program
rates established by this section.
  SEC. 243.  Section 5806 of the Welfare and Institutions Code is
amended to read:
   5806.  The State Department of Mental Health shall establish
service standards that ensure that members of the target population
are identified, and services provided to assist them to live
independently, work, and reach their potential as productive
citizens. The department shall provide annual oversight of grants
issued pursuant to this part for compliance with these standards.
These standards shall include, but are not limited to, all of the
following:
   (a) A service planning and delivery process that is target
population based and includes the following:
   (1) Determination of the numbers of clients to be served and the
programs and services that will be provided to meet their needs. The
local director of mental health shall consult with the sheriff, the
police chief, the probation officer, the mental health board,
contract agencies, and family, client, ethnic, and citizen
constituency groups as determined by the director.
   (2) Plans for services, including outreach to families whose
severely mentally ill adult is living with them, design of mental
health services, coordination and access to medications, psychiatric
and psychological services, substance abuse services, supportive
housing or other housing assistance, vocational rehabilitation, and
veterans' services. Plans also shall contain evaluation strategies,
that shall consider cultural, linguistic, gender, age, and special
needs of minorities in the target populations. Provision shall be
made for staff with the cultural background and linguistic skills
necessary to remove barriers to mental health services due to
limited-English-speaking ability and cultural differences. Recipients
of outreach services may include families, the public, primary care
physicians, and others who are likely to come into contact with
individuals who may be suffering from an untreated severe mental
illness who would be likely to become homeless if the illness
continued to be untreated for a substantial period of time. Outreach
to adults may include adults voluntarily or involuntarily
hospitalized as a result of a severe mental illness.
   (3) Provision for services to meet the needs of target population
clients who are physically disabled.
   (4) Provision for services to meet the special needs of older
adults.
   (5) Provision for family support and consultation services,
parenting support and consultation services, and peer support or
self-help group support, where appropriate for the individual.
   (6) Provision for services to be client-directed and that employ
psychosocial rehabilitation and recovery principles.
   (7) Provision for psychiatric and psychological services that are
integrated with other services and for psychiatric and psychological
collaboration in overall service planning.
   (8) Provision for services specifically directed to seriously
mentally ill young adults 25 years of age or younger who are homeless
or at significant risk of becoming homeless. These provisions may
include continuation of services that still would be received through
other funds had eligibility not been terminated due to age.
   (9) Services reflecting special needs of women from diverse
cultural backgrounds, including supportive housing that accepts
children, personal services coordinator therapeutic treatment, and
substance treatment programs that address gender-specific trauma and
abuse in the lives of persons with mental illness, and vocational
rehabilitation programs that offer job training programs free of
gender bias and sensitive to the needs of women.
   (10) Provision for housing for clients that is immediate,
transitional, permanent, or all of these.
   (11) Provision for clients who have been suffering from an
untreated severe mental illness for less than one year, and who do
not require the full range of services but are at risk of becoming
homeless unless a comprehensive individual and family support
services plan is implemented. These clients shall be served in a
manner that is designed to meet their needs.
   (12) Provision for services for veterans.
   (b) A client shall have a clearly designated mental health
personal services coordinator who may be part of a multidisciplinary
treatment team who is responsible for providing or assuring needed
services. Responsibilities include complete assessment of the client'
s needs, development of the client's personal services plan, linkage
with all appropriate community services, monitoring of the quality
and followthrough of services, and necessary advocacy to ensure that
the client receives those services that are agreed to in the personal
services plan. A client shall participate in the development of his
or her personal services plan, and responsible staff shall consult
with the designated conservator, if one has been appointed, and, with
the consent of the client, consult with the family and other
significant persons as appropriate.
   (c) The individual personal services plan shall ensure that
members of the target population involved in the system of care
receive age-appropriate, gender-appropriate, and culturally
appropriate services or appropriate services based on any
characteristic listed or defined in Section 11135 of the Government
Code, to the extent feasible, that are designed to enable recipients
to:
   (1) Live in the most independent, least restrictive housing
feasible in the local community, and for clients with children, to
live in a supportive housing environment that strives for
reunification with their children or assists clients in maintaining
custody of their children as is appropriate.
   (2) Engage in the highest level of work or productive activity
appropriate to their abilities and experience.
   (3) Create and maintain a support system consisting of friends,
family, and participation in community activities.
   (4) Access an appropriate level of academic education or
vocational training.
   (5) Obtain an adequate income.
   (6) Self-manage their illness and exert as much control as
possible over both the day-to-day and long-term decisions that affect
their lives.
   (7) Access necessary physical health care and maintain the best
possible physical health.
   (8) Reduce or eliminate serious antisocial or criminal behavior
and thereby reduce or eliminate their contact with the criminal
justice system.
   (9) Reduce or eliminate the distress caused by the symptoms of
mental illness.
   (10) Have freedom from dangerous addictive substances.
   (d) The individual personal services plan shall describe the
service array that meets the requirements of subdivision (c), and to
the extent applicable to the individual, the requirements of
subdivision (a).
  SEC. 244.  Section 14083 of the Welfare and Institutions Code is
amended to read:
                  14083.  The factors to be considered by the
negotiator in negotiating contracts under this article, or in drawing
specifications for competitive bidding, include, but are not limited
to, all of the following:
   (a) Beneficiary access.
   (b) Utilization controls.
   (c) Ability to render quality services efficiently and
economically.
   (d) Demonstrated ability to provide or arrange needed specialized
services.
   (e) Protection against fraud and abuse.
   (f) Any other factor which would reduce costs, promote access, or
enhance the quality of care.
   (g) The capacity to provide a given tertiary service, such as
specialized children's services, on a regional basis.
   (h) Recognition of the variations in severity of illness and
complexity of care.
   (i) Existing labor-management collective bargaining agreements.
   (j) The situation of county hospitals and university medical
centers contracting with counties for provision of health care to
indigent persons entitled to care under Section 17000, which are
burdened to a greater extent than private hospitals with bad debts,
indirect costs, medical education programs, and capital needs.
   (k) The special circumstances of hospitals serving a
disproportionate number of Medi-Cal beneficiaries and patients who
are not covered by other third-party payers, including the costs
associated with assuring an adequate supply of registered nurses.
   (  l  ) The costs of providing complex emergency
services, including the costs of meeting and maintaining state and
local requirements for trauma center designation.
   (m) The hospital does any of the following:
   (1) Provides additional obstetrical beds.
   (2) Contracts with one or more comprehensive perinatal providers.
   (3) Permits certified nurse midwives, subject to hospital rules,
and consistent with existing laws and regulations, to admit patients
to the health facility.
   (4) Expands overall obstetrical services in the hospital.
   (n) The special circumstances of hospitals whose Medi-Cal
inpatient utilization rate exceeds the mean Medicaid inpatient
utilization rate by at least one-half of one standard deviation.
   (o) The ability and capacity of the contracting hospital in a
closed health facility planning area to provide health care services
to beneficiaries who are in life-threatening or emergency situations,
but have been sufficiently stabilized at another noncontracting
facility in order to facilitate transportation to the contracting
hospital.
   (p) The ability of the contracting hospital to provide a secure
environment for the provision of health care services. In this
regard, the negotiator shall consider additional security measures
that the contracting hospital may have taken to provide a secure
environment, including, but not limited to, the use of detection
equipment or procedures to detect lethal weapons, the appropriate use
of surveillance cameras, limiting access of unauthorized personnel
to the emergency department, installation of bullet proof glass as
appropriate in designated areas, the use of emergency "panic" buttons
to alert local law enforcement agencies, and assigning full-time
security personnel to the emergency department.
  SEC. 245.  Section 14085.57 of the Welfare and Institutions Code is
amended to read:
   14085.57.  (a) A designated public hospital, as defined in
subdivision (d) of Section 14166.1, that is contracting to provide
services under this article, and that has or would have fulfilled the
criteria set forth in Section 14105.98 or subparagraph (B) of
paragraph (1) of subdivision (c) of Section 14166.3 for the three
most recent years prior to submitting final plans for an eligible
project in accordance with paragraph (3) of subdivision (b), may
receive supplemental reimbursement to the extent provided for in
Section 14085.5, subject to subdivision (c), in addition to the rate
of payment provided for in the contract entered into under this
article.
   (b) (1) A hospital qualifying pursuant to subdivision (a) that
elects to receive reimbursement under this section shall submit
documentation to the department regarding debt service on general
obligation bonds or revenue bonds used for financing the
construction, renovation, or replacement of hospital facilities,
including buildings and fixed equipment.
   (2) A hospital qualifying pursuant to subdivision (a) shall remain
open for the life of the supplemental reimbursements provided for
pursuant to this section.
   (3) (A) Eligible projects shall include those new capital projects
funded by new debt for which final plans have been submitted to the
Office of Statewide Health Planning and Development after January 1,
2007, and prior to December 31, 2011.
   (B) Eligible projects that may receive supplemental reimbursement
pursuant to subdivision (a) are limited to projects related to
meeting seismic safety deadlines.
   (c) No expenditure of state funds, either from the General Fund or
any special fund, shall be made for the nonfederal share of the
supplemental reimbursement provided for in this section. The
department shall, for designated public hospitals that meet the
criteria in subdivision (a), claim federal expenditures through the
use of certified public expenditures or intergovernmental transfers,
as necessary and appropriate.
   (d) The department shall promptly seek any necessary, and all
available, federal approvals for the implementation of this section.
This section shall be implemented only to the extent that federal
approval and federal financial participation are available.
  SEC. 246.  Section 14105.3 of the Welfare and Institutions Code is
amended to read:
   14105.3.  (a) The department is considered to be the purchaser,
but not the dispenser or distributor, of prescribed drugs under the
Medi-Cal program for the purpose of enabling the department to obtain
from manufacturers of prescribed drugs the most favorable price for
those drugs furnished by one or more manufacturers, based upon the
large quantity of the drugs purchased under the Medi-Cal program, and
to enable the department, notwithstanding any other provision of
state law, to obtain from the manufacturers discounts, rebates, or
refunds based on the quantities purchased under the program, insofar
as may be permissible under federal law. Nothing in this section
shall interfere with usual and customary distribution practices in
the drug industry.
   (b) The department may enter into exclusive or nonexclusive
contracts on a bid or negotiated basis with manufacturers,
distributors, dispensers, or suppliers of appliances, durable medical
equipment, medical supplies, and other product-type health care
services and with laboratories for clinical laboratory services for
the purpose of obtaining the most favorable prices to the state and
to assure adequate quality of the product or service. Except as
provided in subdivision (f), this subdivision shall not apply to
prescribed drugs dispensed by pharmacies licensed pursuant to Article
7 (commencing with Section 4110) of Chapter 9 of Division 2 of the
Business and Professions Code.
   (c) Notwithstanding subdivision (b), the department may not enter
into a contract with a clinical laboratory unless the clinical
laboratory operates in conformity with Chapter 3 (commencing with
Section 1200) of Division 2 of the Business and Professions Code and
the regulations adopted thereunder, and Section 263a of Title 42 of
the United States Code and the regulations adopted thereunder.
   (d) The department shall contract with manufacturers of
single-source drugs on a negotiated basis, and with manufacturers of
multisource drugs on a bid or negotiated basis.
   (e) In order to ensure and improve access by Medi-Cal
beneficiaries to both hearing aid appliances and provider services,
and to ensure that the state obtains the most favorable prices, the
department, by June 30, 2008, shall enter into exclusive or
nonexclusive contracts, on a bid or negotiated basis, for purchasing
hearing aid appliances.
   (f) In order to provide specialized care in the distribution of
specialized drugs, as identified by the department and that include,
but are not limited to, blood factors and immunizations, the
department may enter into contracts with providers licensed to
dispense dangerous drugs or devices pursuant to Chapter 9 (commencing
with Section 4000) of Division 2 of the Business and Professions
Code, for programs that qualify for federal funding pursuant to the
medicaid state plan, or waivers and the programs authorized by
Article 5 (commencing with Section 123800) of Chapter 3 of Part 2 of,
and Article 1 (commencing with Section 125125) of Chapter 2 of Part
5 of, Division 106 of the Health and Safety Code, in accordance with
this subdivision.
   (1) The department shall, for purposes of ensuring proper patient
care, consult current standards of practice when executing a provider
contract.
   (2) The department shall, for purposes of ensuring quality of care
to people with unique conditions requiring specialty drugs, contract
with a nonexclusive number of providers that meets the needs of the
affected population, covers all geographic regions in California, and
reflects the distribution of the specialty drug in the community.
The department may use a single provider in the event the product
manufacturer designates a sole-source delivery mechanism. The
department shall consult with interested parties and appropriate
stakeholders in implementing this section with respect to all of the
following:
   (A) Notifying stakeholder representatives of the potential
inclusion or exclusion of drugs in the specialty pharmacy program.
   (B) Allowing for written input regarding the potential inclusion
or exclusion of drugs into the specialty pharmacy program.
   (C) Scheduling at least one public meeting regarding the potential
inclusion or exclusion of drugs into the specialty pharmacy program.

   (D) Obtaining a recommendation from the Medi-Cal Drug Utilization
Review Advisory Committee, established pursuant to Section 1927 of
the federal Social Security Act (42 U.S.C. Sec. 1396r-8), on the
inclusion or exclusion of drugs into the specialty pharmacy program
distribution based on clinical best practices related to each drug
considered.
   (3) For purposes of this subdivision, the definition of "blood
factors" has the same meaning as that term is defined in Section
14105.86.
   (4) The department shall make every reasonable effort to ensure
all medically necessary clotting factor therapies are available for
the treatment of people with bleeding disorders.
   (5) The department shall generate an annual report, published
publicly six months after the end of the first and second years after
implementation, which shall include, but not be limited to, all of
the following information:
   (A) The number and geographic distribution of participating
providers.
   (B) The number and geographic distribution of beneficiaries
receiving specialty drugs, including on a per-provider basis.
   (C) A summary of problems and complaints received regarding the
specialty pharmacy program.
   (D) An evaluation of hospital and emergency services before and
after implementation for the targeted patient population.
   (E) Results of patient satisfaction surveys.
   (F) The cost-effectiveness of the program.
   (6) This subdivision shall become inoperative three years after
the date of implementation, as provided pursuant to a notice to the
public issued by the department, or until July 1, 2013, whichever is
earlier.
   (g) The department may contract with an intermediary to establish
provider contracts pursuant to this section for programs that qualify
for federal funding pursuant to the Medicaid state plan or waivers
and the programs authorized by Article 5 (commencing with Section
123800) of Chapter 3 of Part 2 of, and Article 1 (commencing with
Section 125125) of Chapter 2 of Part 5 of, Division 106 of the Health
and Safety Code.
   (h) In carrying out contracting activity for this or any section
associated with the Medi-Cal list of contract drugs, notwithstanding
Section 19130 of the Government Code, the department may contract,
either directly or through the fiscal intermediary, for pharmacy
consultant staff necessary to accomplish the contracting process or
treatment authorization request reviews. The fiscal intermediary
contract, including any contract amendment, system change pursuant to
a change order, and project or systems development notice shall be
exempt from Part 2 (commencing with Section 10100) of Division 2 of
the Public Contract Code and any policies, procedures, or regulations
authorized by these provisions.
   (i) In order to achieve maximum cost savings the Legislature
hereby determines that an expedited contract process for contracts
under this section is necessary. Therefore, contracts under this
section shall be exempt from Chapter 2 (commencing with Section
10290) of Part 2 of Division 2 of the Public Contract Code.
   (j) For purposes of implementing the contracting provisions
specified in this section, the department shall do all of the
following:
   (1) Ensure adequate access for Medi-Cal patients to quality
laboratory testing services in the geographic regions of the state
where contracting occurs.
   (2) Consult with the statewide association of clinical
laboratories and other appropriate stakeholders on the implementation
of the contracting provisions specified in this section to ensure
maximum access for Medi-Cal patients consistent with the savings
targets projected by the 2002-03 budget conference committee for
clinical laboratory services provided under the Medi-Cal program.
   (3) Consider which types of laboratories are appropriate for
implementing the contracting provisions specified in this section,
including independent laboratories, outreach laboratory programs of
hospital-based laboratories, clinic laboratories, physician office
laboratories, and group practice laboratories.
  SEC. 247.  Section 14132.725 of the Welfare and Institutions Code
is amended to read:
   14132.725.  (a) Commencing July 1, 2006, to the extent that
federal financial participation is available, face-to-face contact
between a health care provider and a patient shall not be required
under the Medi-Cal program for teleophthalmology and teledermatology
by store and forward. Services appropriately provided through the
store and forward process are subject to billing and reimbursement
policies developed by the department.
   (b) For purposes of this section, "teleophthalmology and
teledermatology by store and forward" means an asynchronous
transmission of medical information to be reviewed at a later time by
a physician at a distant site who is trained in ophthalmology or
dermatology or, for teleophthalmology, by an optometrist who is
licensed pursuant to Chapter 7 (commencing with Section 3000) of
Division 2 of the Business and Professions Code, where the physician
or optometrist at the distant site reviews the medical information
without the patient being present in real time. A patient receiving
teleophthalmology or teledermatology by store and forward shall be
notified of the right to receive interactive communication with the
distant specialist physician or optometrist, and shall receive an
interactive communication with the distant specialist physician or
optometrist, upon request. If requested, communication with the
distant specialist physician or optometrist may occur either at the
time of the consultation, or within 30 days of the patient's
notification of the results of the consultation. If the reviewing
optometrist identifies a disease or condition requiring consultation
or referral pursuant to Section 3041 of the Business and Professions
Code, that consultation or referral shall be with an ophthalmologist
or other appropriate physician and surgeon, as required.
   (c) Notwithstanding Chapter 3.5 (commencing with Section 11340) of
Part 1 of Division 3 of Title 2 of the Government Code, the
department may implement, interpret, and make specific this section
by means of all-county letters, provider bulletins, and similar
instructions.
   (d) On or before January 1, 2008, the department shall report to
the Legislature the number and type of services provided, and the
payments made related to the application of store and forward
telemedicine as provided, under this section as a Medi-Cal benefit.
   (e) The health care provider shall comply with the informed
consent provisions of subdivisions (c) to (g), inclusive, of, and
subdivisions (i) and (j) of, Section 2290.5 of the Business and
Professions Code when a patient receives teleophthalmology or
teledermatology by store and forward.
   (f) This section shall remain in effect only until January 1,
2013, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2013, deletes or extends
that date.
  SEC. 248.  Section 14154 of the Welfare and Institutions Code is
amended to read:
   14154.  (a) The department shall establish and maintain a plan
whereby costs for county administration of the determination of
eligibility for benefits under this chapter will be effectively
controlled within the amounts annually appropriated for that
administration. The plan, to be known as the County Administrative
Cost Control Plan, shall establish standards and performance
criteria, including workload, productivity, and support services
standards, to which counties shall adhere. The plan shall include
standards for controlling eligibility determination costs that are
incurred by performing eligibility determinations at county
hospitals, or that are incurred due to the outstationing of any other
eligibility function. Except as provided in Section 14154.15,
reimbursement to a county for outstationed eligibility functions
shall be based solely on productivity standards applied to that
county's welfare department office. The plan shall be part of a
single state plan, jointly developed by the department and the State
Department of Social Services, in conjunction with the counties, for
administrative cost control for the California Work Opportunity and
Responsibility to Kids (CalWORKs), Food Stamp, and Medical Assistance
(Medi-Cal) programs. Allocations shall be made to each county and
shall be limited by and determined based upon the County
Administrative Cost Control Plan. In administering the plan to
control county administrative costs, the department shall not
allocate state funds to cover county cost overruns that result from
county failure to meet requirements of the plan. The department and
the State Department of Social Services shall budget, administer, and
allocate state funds for county administration in a uniform and
consistent manner.
   (b) Nothing in this section, Section 15204.5, or Section 18906
shall be construed so as to limit the administrative or budgetary
responsibilities of the department in a manner that would violate
Section 14100.1, and thereby jeopardize federal financial
participation under the Medi-Cal program.
   (c) (1) The Legislature finds and declares that in order for
counties to do the work that is expected of them, it is necessary
that they receive adequate funding, including adjustments for
reasonable annual cost-of-doing-business increases. The Legislature
further finds and declares that linking appropriate funding for
county Medi-Cal administrative operations, including annual
cost-of-doing-business adjustments, with performance standards will
give counties the incentive to meet the performance standards and
enable them to continue to do the work they do on behalf of the
state. It is therefore the Legislature's intent to provide
appropriate funding to the counties for the effective administration
of the Medi-Cal program at the local level to ensure that counties
can reasonably meet the purposes of the performance measures as
contained in this section.
   (2) It is the intent of the Legislature to not appropriate funds
for the cost-of-doing-business adjustment for the 2008-09 and 2009-10
fiscal years.
   (d) The department is responsible for the Medi-Cal program in
accordance with state and federal law. A county shall determine
Medi-Cal eligibility in accordance with state and federal law. If in
the course of its duties the department becomes aware of accuracy
problems in any county, the department shall, within available
resources, provide training and technical assistance as appropriate.
Nothing in this section shall be interpreted to eliminate any remedy
otherwise available to the department to enforce accurate county
administration of the program. In administering the Medi-Cal
eligibility process, each county shall meet the following performance
standards each fiscal year:
   (1) Complete eligibility determinations as follows:
   (A) Ninety percent of the general applications without applicant
errors and are complete shall be completed within 45 days.
   (B) Ninety percent of the applications for Medi-Cal based on
disability shall be completed within 90 days, excluding delays by the
state.
   (2) (A) The department shall establish best practice guidelines
for expedited enrollment of newborns into the Medi-Cal program,
preferably with the goal of enrolling newborns within 10 days after
the county is informed of the birth. The department, in consultation
with counties and other stakeholders, shall work to develop a process
for expediting enrollment for all newborns, including those born to
mothers receiving CalWORKs assistance.
   (B) Upon the development and implementation of the best practice
guidelines and expedited processes, the department and the counties
may develop an expedited enrollment timeframe for newborns that is
separate from the standards for all other applications, to the extent
that the timeframe is consistent with these guidelines and
processes.
   (C) Notwithstanding the rulemaking procedures of Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3 of Title 2 of
the Government Code, the department may implement this section by
means of all-county letters or similar instructions, without further
regulatory action.
   (3) Perform timely annual redeterminations, as follows:
   (A) Ninety percent of the annual redetermination forms shall be
mailed to the recipient by the anniversary date.
   (B) Ninety percent of the annual redeterminations shall be
completed within 60 days of the recipient's annual redetermination
date for those redeterminations based on forms that are complete and
have been returned to the county by the recipient in a timely manner.

   (C) Ninety percent of those annual redeterminations where the
redetermination form has not been returned to the county by the
recipient shall be completed by sending a notice of action to the
recipient within 45 days after the date the form was due to the
county.
   (D) When a child is determined by the county to change from no
share of cost to a share of cost and the child meets the eligibility
criteria for the Healthy Families Program established under Section
12693.98 of the Insurance Code, the child shall be placed in the
Medi-Cal-to-Healthy Families Bridge Benefits Program, and these cases
shall be processed as follows:
   (i) Ninety percent of the families of these children shall be sent
a notice informing them of the Healthy Families Program within five
working days from the determination of a share of cost.
   (ii) Ninety percent of all annual redetermination forms for these
children shall be sent to the Healthy Families Program within five
working days from the determination of a share of cost if the parent
has given consent to send this information to the Healthy Families
Program.
   (iii) Ninety percent of the families of these children placed in
the Medi-Cal-to-Healthy Families Bridge Benefits Program who have not
consented to sending the child's annual redetermination form to the
Healthy Families Program shall be sent a request, within five working
days of the determination of a share of cost, to consent to send the
information to the Healthy Families Program.
   (E) Subparagraph (D) shall not be implemented until 60 days after
the Medi-Cal and Joint Medi-Cal and Healthy Families applications and
the Medi-Cal redetermination forms are revised to allow the parent
of a child to consent to forward the child's information to the
Healthy Families Program.
   (e) The department shall develop procedures in collaboration with
the counties and stakeholder groups for determining county review
cycles, sampling methodology and procedures, and data reporting.
   (f) On January 1 of each year, each applicable county, as
determined by the department, shall report to the department on the
county's results in meeting the performance standards specified in
this section. The report shall be subject to verification by the
department. County reports shall be provided to the public upon
written request.
   (g) If the department finds that a county is not in compliance
with one or more of the standards set forth in this section, the
county shall, within 60 days, submit a corrective action plan to the
department for approval. The corrective action plan shall, at a
minimum, include steps that the county shall take to improve its
performance on the standard of standards with which the county is out
of compliance. The plan shall establish interim benchmarks for
improvement that shall be expected to be met by the county in order
to avoid a sanction.
   (h) (1) If a county does not meet the performance standards for
completing eligibility determinations and redeterminations as
specified in this section, the department may, at its sole
discretion, reduce the allocation of funds to that county in the
following year by 2 percent. Any funds so reduced may be restored by
the department if, in the determination of the department, sufficient
improvement has been made by the county in meeting the performance
standards during the year for which the funds were reduced. If the
county continues not to meet the performance standards, the
department may reduce the allocation by an additional 2 percent for
each year thereafter in which sufficient improvement has not been
made to meet the performance standards.
   (2) No reduction of the allocation of funds to a county shall be
imposed pursuant to this subdivision for failure to meet performance
standards during any period of time in which the
cost-of-doing-business increase is suspended.
   (i) The department shall develop procedures, in collaboration with
the counties and stakeholders, for developing instructions for the
performance standards established under subparagraph (D) of paragraph
(3) of subdivision (d), no later than September 1, 2005.
                                           (j) No later than
September 1, 2005, the department shall issue a revised annual
redetermination form to allow a parent to indicate parental consent
to forward the annual redetermination form to the Healthy Families
Program if the child is determined to have a share of cost.
   (k) The department, in coordination with the Managed Risk Medical
Insurance Board, shall streamline the method of providing the Healthy
Families Program with information necessary to determine Healthy
Families eligibility for a child who is receiving services under the
Medi-Cal-to-Healthy Families Bridge Benefits Program.
  SEC. 249.  Section 14163 of the Welfare and Institutions Code is
amended to read:
   14163.  (a) For purposes of this section, the following
definitions shall apply:
   (1) "Public entity" means a county, a city, a city and county, the
State of California, the University of California, a local health
care district, a local health authority, or any other political
subdivision of the state.
   (2) "Hospital" means a health facility that is licensed pursuant
to Chapter 2 (commencing with Section 1250) of Division 2 of the
Health and Safety Code to provide acute inpatient hospital services,
and includes all components of the facility.
   (3) "Disproportionate share hospital" means a hospital providing
acute inpatient services to Medi-Cal beneficiaries that meets the
criteria for disproportionate share status relating to acute
inpatient services set forth in Section 14105.98.
   (4) "Disproportionate share list" means the annual list of
disproportionate share hospitals for acute inpatient services issued
by the department pursuant to Section 14105.98.
   (5) "Fund" means the Medi-Cal Inpatient Payment Adjustment Fund.
   (6) "Eligible hospital" means, for a particular state fiscal year,
a hospital on the disproportionate share list that is eligible to
receive payment adjustment amounts under Section 14105.98 with
respect to that state fiscal year.
   (7) "Transfer year" means the particular state fiscal year during
which, or with respect to which, public entities are required by this
section to make an intergovernmental transfer of funds to the
Controller.
   (8) "Transferor entity" means a public entity that, with respect
to a particular transfer year, is required by this section to make an
intergovernmental transfer of funds to the Controller.
   (9) "Transfer amount" means an amount of intergovernmental
transfer of funds that this section requires for a particular
transferor entity with respect to a particular transfer year.
   (10) "Intergovernmental transfer" means a transfer of funds from a
public entity to the state that is local government financial
participation in Medi-Cal pursuant to the terms of this section.
   (11) "Licensee" means an entity that has been issued a license to
operate a hospital by the department.
   (12) "Annualized Medi-Cal inpatient paid days" means the total
number of Medi-Cal acute inpatient hospital days, regardless of dates
of service, for which payment was made by or on behalf of the
department to a hospital, under present or previous ownership, during
the most recent calendar year ending prior to the beginning of a
particular transfer year, including all Medi-Cal acute inpatient
covered days of care for hospitals that are paid on a different basis
than per diem payments.
   (13) "Medi-Cal acute inpatient hospital day" means any acute
inpatient day of service attributable to patients who, for those
days, were eligible for medical assistance under the California state
plan, including any day of service that is reimbursed on a basis
other than per diem payments.
   (14) "OBRA 1993 payment limitation" means the hospital-specific
limitation on the total annual amount of payment adjustments to each
eligible hospital under the payment adjustment program that can be
made with federal financial participation under Section 1396r-4(g) of
Title 42 of the United States Code as implemented pursuant to the
Medi-Cal State Plan.
   (b) The Medi-Cal Inpatient Payment Adjustment Fund is hereby
created in the State Treasury. Notwithstanding Section 13340 of the
Government Code, the fund shall be continuously appropriated to, and
under the administrative control of, the department for the purposes
specified in subdivision (d). The fund shall consist of the
following:
   (1) Transfer amounts collected by the Controller under this
section, whether submitted by transferor entities pursuant to
applicable provisions of this section or obtained by offset pursuant
to subdivision (j).
   (2) Any other intergovernmental transfers deposited in the fund,
as permitted by Section 14164.
   (3) Any interest that accrues with respect to amounts in the fund.

   (c) Moneys in the fund, which shall not consist of any state
general funds, shall be used as the source for the nonfederal share
of payments to hospitals pursuant to Section 14105.98. Moneys shall
be allocated from the fund by the department and matched by federal
funds in accordance with customary Medi-Cal accounting procedures,
and used to make payments pursuant to Section 14105.98.
   (d) Except as otherwise provided in Section 14105.98 or in any law
appropriating a specified sum of money to the department for
administering this section and Section 14105.98, moneys in the fund
shall be used only for the following:
   (1) Payments to hospitals pursuant to Section 14105.98.
   (2) Transfers to the Health Care Deposit Fund as follows:
   (A) In the amount of two hundred thirty-nine million seven hundred
fifty-seven thousand six hundred ninety dollars ($239,757,690) for
the 1994-95 and 1995-96 fiscal years.
   (B) In the amount of two hundred twenty-nine million seven hundred
fifty-seven thousand six hundred ninety dollars ($229,757,690) for
the 1996-97 fiscal year.
   (C) In the amount of one hundred fifty-four million seven hundred
fifty-seven thousand six hundred ninety dollars ($154,757,690) for
the 1997-98 fiscal year.
   (D) In the amount of one hundred fourteen million seven hundred
fifty-seven thousand six hundred ninety dollars ($114,757,690) for
the 1998-99 fiscal year.
   (E) (i) In the amount of eighty-four million seven hundred
fifty-seven thousand six hundred ninety dollars ($84,757,690) for the
1999-2000 fiscal year.
   (ii) It is the intent of the Legislature that the economic benefit
of any reduction in the amount transferred, or to be transferred, to
the Health Care Deposit Fund pursuant to this subdivision for the
1999-2000 fiscal year, as compared to the amount so transferred for
the 1998-99 fiscal year, be allocated equally between public and
nonpublic disproportionate share hospitals. To implement the
reduction in clause (i) the department shall, by June 30, 2000,
adjust the calculations in Section 14105.98 in order to allocate the
funds in accordance with this clause.
   (F) In the amount of twenty-nine million seven hundred fifty-seven
thousand six hundred ninety dollars ($29,757,690) for the 2000-01
fiscal year and the 2001-02 fiscal year.
   (G) In the amount of eighty-five million dollars ($85,000,000) for
the 2002-03 fiscal year and each fiscal year thereafter.
   (H) The transfers from the fund shall be made in six equal monthly
installments to the Medi-Cal local assistance appropriation item
(Item 4260-101-0001 of Section 2.00 of the annual Budget Act) in
support of Medi-Cal expenditures. The first installment shall accrue
in October of each transfer year, and all other installments shall
accrue monthly thereafter from November through March.
   (e) For the 1991-92 state fiscal year, the department shall
determine, no later than 70 days after the enactment of this section,
the transferor entities for the 1991-92 transfer year. To make this
determination, the department shall utilize the disproportionate
share list for the 1991-92 fiscal year issued by the department
pursuant to paragraph (1) of subdivision (f) of Section 14105.98. The
department shall identify each eligible hospital on the list for
which a public entity is the licensee as of July 1, 1991. The public
entity that is the licensee of each identified eligible hospital
shall be a transferor entity for the 1991-92 transfer year.
   (f) The department shall determine, no later than 70 days after
the enactment of this section, the transfer amounts for the 1991-92
transfer year.
   The transfer amounts shall be determined as follows:
   (1) The eligible hospitals for 1991-92 shall be identified. For
each hospital, the applicable total per diem payment adjustment
amount under Section 14105.98 for the 1991-92 transfer year shall be
computed. This amount shall be multiplied by 80 percent of the
eligible hospital's annualized Medi-Cal inpatient paid days as
determined from all Medi-Cal paid claims records available through
April 1, 1991. The products of these calculations for all eligible
hospitals shall be added together to determine an aggregate sum for
the 1991-92 transfer year.
   (2) The eligible hospitals for 1991-92 involving transferor
entities as licensees shall be identified. For each hospital, the
applicable total per diem payment adjustment amount under Section
14105.98 for the 1991-92 transfer year shall be computed. This amount
shall be multiplied by 80 percent of the eligible hospital's
annualized Medi-Cal inpatient paid days as determined from all
Medi-Cal paid claims records available through April 1, 1991. The
products of these calculations for all eligible hospitals with
transferor entities as licensees shall be added together to determine
an aggregate sum for the 1991-92 transfer year.
   (3) The aggregate sum determined under paragraph (1) shall be
divided by the aggregate sum determined under paragraph (2), yielding
a factor to be utilized in paragraph (4).
   (4) The factor determined in paragraph (3) shall be multiplied by
the amount determined for each hospital under paragraph (2). The
product of this calculation for each hospital in paragraph (2) shall
be divided by 1.771, yielding a transfer amount for the particular
transferor entity for the transfer year.
   (g) For the 1991-92 transfer year, the department shall notify
each transferor entity in writing of its applicable transfer amount
or amounts.
   (h) For the 1992-93 transfer year and subsequent transfer years,
transfer amounts shall be determined in the same procedural manner as
set forth in subdivision (f), except:
   (1) The department shall use all of the following:
   (A) The disproportionate share list applicable to the particular
transfer year to determine the eligible hospitals.
   (B) The payment adjustment amounts calculated under Section
14105.98 for the particular transfer year. These amounts shall take
into account any projected or actual increases or decreases in the
size of the payment adjustment program as are required under Section
14105.98 for the particular year in question, including any decreases
resulting from the application of the OBRA 1993 payment limitation.
The department may issue interim, revised, and supplemental transfer
requests as necessary and appropriate to address changes in payment
adjustment levels that occur under Section 14105.98. All transfer
requests, or adjustments thereto, issued to transferor entities by
the department shall meet the requirements set forth in subdivision
(i).
   (C) Data regarding annualized Medi-Cal inpatient paid days for the
most recent calendar year ending prior to the beginning of the
particular transfer year, as determined from all Medi-Cal paid claims
records available through April 1 preceding the particular transfer
year.
   (D) The status of public entities as licensees of eligible
hospitals as of July 1 of the particular transfer year.
   (E) For the 1993-94 transfer year and subsequent transfer years,
the divisor to be used for purposes of the calculation referred to in
paragraph (4) of subdivision (f) shall be determined by the
department. The divisor shall be calculated to ensure that the
appropriate amount of transfers from transferor entities are received
into the fund to satisfy the requirements of Section 14105.98,
exclusive of the amounts described in paragraph (2) of this
subdivision, and to satisfy the requirements of paragraph (2) of
subdivision (d), for the particular transfer year. For the 1993-94
transfer year, the divisor shall be 1.742.
   (F) The following provisions shall apply for certain transfer
amounts relating to nonsupplemental payments under Section 14105.98:
   (i) For the 1998-99 transfer year, transfer amounts shall be
determined as though the payment adjustment amounts arising pursuant
to subdivision (ag) of Section 14105.98 were increased by the amounts
paid or payable pursuant to subdivision (af) of Section 14105.98.
   (ii) Any transfer amounts paid by a transferor entity pursuant to
subparagraph (C) of paragraph (2) shall serve as credit for the
particular transferor entity against an equal amount of its transfer
obligation for the 1998-99 transfer year.
   (iii) For the 1999-2000 transfer year, transfer amounts shall be
determined as though the amount to be transferred to the Health Care
Deposit Fund, as referred to in paragraph (2) of subdivision (d),
were reduced by 28 percent.
   (2) (A) Except as provided in subparagraphs (B), (C), and (D), for
the 1993-94 transfer year and subsequent transfer years, transfer
amounts shall be increased for the particular transfer year in the
amounts necessary to fund the nonfederal share of the total
supplemental payment adjustment amounts of all types that arise under
Section 14105.98. These increases shall be paid only by those
transferor entities that are licensees of hospitals that are
projected to receive some or all of the particular supplemental
payments, and the increases shall be paid by the transferor entities
on a pro rata basis in connection with the particular supplemental
payments. For purposes of this paragraph, supplemental payment
adjustment amounts shall be deemed to arise for the particular
transfer year as of the date specified in Section 14105.98. Transfer
amounts to fund the nonfederal share of the payments shall be paid
for the particular transfer year within 20 days after the department
notifies the transferor entity in writing of the additional transfer
amount to be paid.
   (B) For the 1995-96 transfer year, the nonfederal share of the
secondary supplemental payment adjustments described in paragraph (9)
of subdivision (y) of Section 14105.98 shall be funded as follows:
   (i) Ninety-nine percent of the nonfederal share shall be funded by
a transfer from the University of California.
   (ii) One percent of the nonfederal share shall be funded by
transfers from those public entities that are the licensees of the
hospitals included in the "other public hospitals" group referred to
in clauses (ii) and (iii) of subparagraph (B) of paragraph (9) of
subdivision (y) of Section 14105.98. The transfer responsibilities
for this 1 percent shall be allocated to the particular public
entities on a pro rata basis, based on a formula or formulae
customarily used by the department for allocating transfer amounts
under this section. The formula or formulae shall take into account,
through reallocation of transfer amounts as appropriate, the
situation of hospitals whose secondary supplemental payment
adjustments are restricted due to the application of the limitation
set forth in clause (v) of subparagraph (B) of paragraph (9) of
subdivision (y) of Section 14105.98.
   (iii) All transfer amounts under this subparagraph shall be paid
by the particular transferor entities within 30 days after the
department notifies the transferor entity in writing of the transfer
amount to be paid.
   (C) For the 1997-98 transfer year, transfer amounts to fund the
nonfederal share of the supplemental payment adjustments described in
subdivision (af) of Section 14105.98 shall be funded by a transfer
from the County of Los Angeles.
   (D) (i) For the 1998-99 transfer year, transfer amounts to fund
the nonfederal share of the supplemental payment adjustment amounts
arising under subdivision (ah) of Section 14105.98 shall be increased
as set forth in clause (ii).
   (ii) The transfer amounts otherwise calculated to fund the
supplemental payment adjustments referred to in clause (i) shall be
increased on a pro rata basis by an amount equal to 28 percent of the
amount to be transferred to the Health Care Deposit Fund for the
1999-2000 fiscal year, as referred to in paragraph (2) of subdivision
(d).
   (3) The department shall prepare preliminary analyses and
calculations regarding potential transfer amounts, and potential
transferor entities shall be notified by the department of estimated
transfer amounts as soon as reasonably feasible regarding any
particular transfer year. Written notices of transfer amounts shall
be issued by the department as soon as possible with respect to each
transfer year. All state agencies shall take all necessary steps in
order to supply applicable data to the department to accomplish these
tasks. The Office of Statewide Health Planning and Development shall
provide to the department quarterly access to the edited and
unedited confidential patient discharge data files for all Medi-Cal
eligible patients. The department shall maintain the confidentiality
of that data to the same extent as is required of the Office of
Statewide Health Planning and Development. In addition, the Office of
Statewide Health Planning and Development shall provide to the
department, not later than March 1 of each year, the data specified
by the department, as the data existed on the statewide database file
as of February 1 of each year, from all of the following:
   (A) Hospital annual disclosure reports, filed with the Office of
Statewide Health Planning and Development pursuant to former Section
443.31 of, or Section 128735 of, the Health and Safety Code, for
hospital fiscal years that ended during the calendar year ending 13
months prior to the applicable February 1.
   (B) Annual reports of hospitals, filed with the Office of
Statewide Health Planning and Development pursuant to former Section
439.2 of, or Section 127285 of, the Health and Safety Code, for the
calendar year ending 13 months prior to the applicable February 1.
   (C) Hospital patient discharge data reports, filed with the Office
of Statewide Health Planning and Development pursuant to former
subdivision (g) of Section 443.31 of, or Section 128735 of, the
Health and Safety Code, for the calendar year ending 13 months prior
to the applicable February 1.
   (D) Any other materials on file with the Office of Statewide
Health Planning and Development.
   (4) Transfer amounts calculated by the department may be increased
or decreased by a percentage amount consistent with the Medi-Cal
state plan.
   (5) For the 1993-94 fiscal year, the transfer amount that would
otherwise be required from the University of California shall be
increased by fifteen million dollars ($15,000,000).
   (6) Notwithstanding any other law, except for subparagraph (D) of
paragraph (2), the total amount of transfers required from the
transferor entities for any particular transfer year shall not exceed
the sum of the following:
   (A) The amount needed to fund the nonfederal share of all payment
adjustment amounts applicable to the particular payment adjustment
year as calculated under Section 14105.98. Included in the
calculations for this purpose shall be any decreases in the program
as a whole, and for individual hospitals, that arise due to the
provisions of Section 1396r-4(f) or (g) of Title 42 of the United
States Code.
   (B) The amount needed to fund the transfers to the Health Care
Deposit Fund, as referred to in subdivision (d).
   (7) (A) Except as provided in subparagraphs (B) and (C) and in
paragraph (2) of subdivision (j), and except for a prudent reserve
not to exceed two million dollars ($2,000,000) in the Medi-Cal
Inpatient Payment Adjustment Fund, any amounts in the fund, including
interest that accrues with respect to the amounts in the fund, that
are not expended, or estimated to be required for expenditure, under
Section 14105.98 with respect to a particular transfer year shall be
returned on a pro rata basis to the transferor entities for the
particular transfer year within 120 days after the department
determines that the funds are not needed for an expenditure in
connection with the particular transfer year.
   (B) The department shall determine the interest amounts that have
accrued in the fund from its inception through June 30, 1995, and, no
later than January 1, 1996, shall distribute these interest amounts
to transferor entities:
   (C) With respect to those particular amounts in the fund resulting
solely from the provisions of subparagraph (D) of paragraph (2), the
department shall determine by September 30, 1999, whether these
particular amounts exceed 28 percent of the amount to be transferred
to the Health Care Deposit Fund for the 1999-2000 fiscal year, as
referred to in paragraph (2) of subdivision (d). Any excess amount so
determined shall be returned to the particular transferor entities
on a pro rata basis no later than October 31, 1999.
   (D) Regarding any funds returned to a transferor entity under
subparagraph (A) or (C), or interest amounts distributed to a
transferor entity under subparagraph (B), the department shall
provide to the transferor entity a written statement that explains
the basis for the particular return or distribution of funds and
contains the general calculations used by the department in
determining the amount of the particular return or distribution of
funds.
   (i) (1) For the 1991-92 transfer year, each transferor entity
shall pay its transfer amount or amounts to the Controller, for
deposit in the fund, in eight equal installments.
   (2) (A) Except as provided in subparagraphs (B) and (C), for the
1992-93 transfer year and subsequent transfer years, each transferor
entity shall pay its transfer amount or amounts to the Controller,
for deposit in the fund, in eight equal installments. However, for
the 1997-98 and subsequent transfer years, each transferor entity
shall pay its transfer amount or amounts to the Controller, for
deposit in the fund, in the form of periodic installments according
to a timetable established by the department. The timetable shall be
structured to effectuate, on a reasonable basis, the prompt
distribution of all nonsupplemental payment adjustments under Section
14105.98, and transfers to the Health Care Deposit Fund under
subdivision (d).
   (B) For the 1994-95 transfer year, each transferor entity shall
pay its transfer amount or amounts to the Controller, for deposit in
the fund, in five equal installments.
   (C) For the 1995-96 transfer year, each transferor entity shall
pay its transfer amount or amounts to the Controller, for deposit in
the fund, in five equal installments.
   (D) Except as otherwise specifically provided, subparagraphs (A)
to (C), inclusive, shall not apply to increases in transfer amounts
described in paragraph (2) of subdivision (h) or to additional
transfer amounts described in subdivision (o).
   (E) All requests for transfer payments, or adjustments thereto,
issued by the department shall be in writing and shall include (i) an
explanation of the basis for the particular transfer request or
transfer activity, (ii) a summary description of program funding
status for the particular transfer year, and (iii) the general
calculations used by the department in connection with the particular
transfer request or transfer activity.
   (3) A transferor entity may use any of the following funds for
purposes of meeting its transfer obligations under this section:
   (A) General funds of the transferor entity.
   (B) Any other funds permitted by law to be used for these
purposes, except that a transferor entity shall not submit to the
Controller any federal funds unless those federal funds are
authorized by federal law to be used to match other federal funds. In
addition, no private donated funds from any health care provider, or
from any person or organization affiliated with the health care
provider, shall be channeled through a transferor entity or any other
public entity to the fund, unless the donated funds will qualify
under federal rules as a valid component of the nonfederal share of
the Medi-Cal program and will be matched by federal funds. The
transferor entity shall be responsible for determining that funds
transferred meet the requirements of this subparagraph.
   (j) (1) If a transferor entity does not submit any transfer amount
within the time period specified in this section, the Controller
shall offset immediately the amount owed against any funds which
otherwise would be payable by the state to the transferor entity. The
Controller, however, shall not impose an offset against any
particular funds payable to the transferor entity where the offset
would violate state or federal law.
   (2) Where a withhold or a recoupment occurs pursuant to the
provisions of paragraph (2) of subdivision (r) of Section 14105.98,
the nonfederal portion of the amount in question shall remain in the
fund, or shall be redeposited in the fund by the department, as
applicable. The department shall then proceed as follows:
   (A) If the withhold or recoupment was imposed with respect to a
hospital whose licensee was a transferor entity for the particular
state fiscal year to which the withhold or recoupment related, the
nonfederal portion of the amount withheld or recouped shall serve as
a credit for the particular transferor entity against an equal amount
of transfer obligations under this section, to be applied whenever
the transfer obligations next arise. Should no such transfer
obligation arise within 180 days, the department shall return the
funds in question to the particular transferor entity within 30 days
thereafter.
   (B) For other situations, the withheld or recouped nonfederal
portion shall be subject to paragraph (7) of subdivision (h).
   (k) All transfer amounts received by the Controller or amounts
offset by the Controller shall immediately be deposited in the fund.
   (  l  ) For purposes of this section, the
disproportionate share list utilized by the department for a
particular transfer year shall be identical to the disproportionate
share list utilized by the department for the same state fiscal year
for purposes of Section 14105.98. Nothing on a disproportionate share
list, once issued by the department, shall be modified for any
reason other than mathematical or typographical errors or omissions
on the part of the department or the Office of Statewide Health
Planning and Development in preparation of the list.
                                           (m) Neither the
intergovernmental transfers required by this section, nor any
elective transfer made pursuant to Section 14164, shall create, lead
to, or expand the health care funding or service obligations for
current or future years for any transferor entity, except as required
of the state by this section or as may be required by federal law,
in which case the state shall be held harmless by the transferor
entities on a pro rata basis.
   (n) Except as otherwise permitted by state and federal law, no
transfer amount submitted to the Controller under this section, and
no offset by the Controller pursuant to subdivision (j), shall be
claimed or recognized as an allowable element of cost in Medi-Cal
cost reports submitted to the department.
   (o) Whenever additional transfer amounts are required to fund the
nonfederal share of payment adjustment amounts under Section 14105.98
that are distributed after the close of the particular payment
adjustment year to which the payment adjustment amounts apply, the
additional transfer amounts shall be paid by the parties who were the
transferor entities for the particular transfer year that was
concurrent with the particular payment adjustment year. The
additional transfer amounts shall be calculated under the formula
that was in effect during the particular transfer year. For transfer
years prior to the 1993-94 transfer year, the percentage of the
additional transfer amounts available for transfer to the Health Care
Deposit Fund under subdivision (d) shall be the percentage that was
in effect during the particular transfer year. These additional
transfer amounts shall be paid by transferor entities within 20 days
after the department notifies the transferor entity in writing of the
additional transfer amount to be paid.
   (p) (1) Ten million dollars ($10,000,000) of the amount
transferred from the Medi-Cal Inpatient Payment Adjustment Fund to
the Health Care Deposit Fund due to amounts transferred attributable
to years prior to the 1993-94 fiscal year is hereby appropriated
without regard to fiscal years to the State Department of Health Care
Services to be used to support the development of managed care
programs under the department's plan to expand Medi-Cal managed care.

   (2) These funds shall be used by the department for both of the
following purposes: (A) distributions to counties or other local
entities that contract with the department to receive those funds to
offset a portion of the costs of forming the local initiative entity
and (B) distributions to local initiative entities that contract with
the department to receive those funds to offset a portion of the
costs of developing the local initiative health delivery system in
accordance with the department's plan to expand Medi-Cal managed
care.
   (3) Entities contracting with the department for any portion of
the ten million dollars ($10,000,000) shall meet the objectives of
the department's plan to expand Medi-Cal managed care with regard to
traditional and safety net providers.
   (4) Entities contracting with the department for any portion of
the ten million dollars ($10,000,000) may be authorized under those
contracts to utilize their funds to provide for reimbursement of the
costs of local organizations and entities incurred in participating
in the development and operation of a local initiative.
   (5) To the full extent permitted by state and federal law, these
funds shall be distributed by the department for expenditure at the
local level in a manner that qualifies for federal financial
participation under the Medicaid Program.
   (q) (1) Any local initiative entity that has performed
unanticipated additional work for the purposes identified in
subparagraph (B) of paragraph (2) of subdivision (p) resulting in
additional costs attributable to the development of its local
initiative health delivery system, may file a claim for reimbursement
with the department for the additional costs incurred due to delays
in start dates through the 1996-97 fiscal year. The claim shall be
filed by the local initiative entity not later than 90 days after the
effective date of the act adding this subdivision, and shall not
seek extra compensation for any sum that is or could have been
asserted pursuant to the contract disputes and appeals resolution
provisions of the local initiative entity's respective two-plan model
contract. All claims for unanticipated additional incurred costs
shall be submitted with adequate supporting documentation including,
but not limited to, all of the following:
   (A) Invoices, receipts, job descriptions, payroll records, work
plans, and other materials that identify the unanticipated additional
claimed and incurred costs.
   (B) Documents reflecting mitigation of costs.
   (C) To the extent lost profits are included in the claim,
documentation identifying those profits and the manner of
calculation.
   (D) Documents reflecting the anticipated start date, the actual
start date, and reasons for the delay between the dates, if any.
   (2) In determining any amount to be paid, the department shall do
all of the following:
   (A) Conduct a fiscal analysis of the local initiative entity's
claimed costs.
   (B) Determine the appropriate amount of payment, after taking into
consideration the supporting documentation and the results of any
audit.
   (C) Provide funding for any such payment, as approved by the
Department of Finance through the deficiency process.
   (D) Complete the determination required in subparagraph (B) within
six months after receipt of a local initiative entity's completed
claim and supporting documentation. Prior to final determination,
there shall be a review and comment period for that local initiative
entity.
   (E) Make reasonable efforts to obtain federal financial
participation. In the event federal financial participation is not
allowed for this payment, the state's payment shall be 50 percent of
the total amount determined to be payable.
   (r) Notwithstanding any other law, the Controller may use the
moneys in the Medi-Cal Inpatient Payment Adjustment Fund for loans to
the General Fund as provided in Sections 16310 and 16381 of the
Government Code. However, interest shall be paid on all moneys loaned
to the General Fund from the Medi-Cal Inpatient Payment Adjustment
Fund. Interest payable shall be computed at a rate determined by the
Pooled Money Investment Board to be the current earning rate of the
fund from which loaned. This subdivision does not authorize any
transfer that will interfere with the carrying out of the object for
which the Medi-Cal Inpatient Payment Adjustment Fund was created.
  SEC. 250.  Section 14166.221 of the Welfare and Institutions Code
is amended to read:
   14166.221.  (a) It is the intent of the Legislature for the
department to maximize the receipt of federal funds for California's
Medi-Cal program, including this demonstration project, by
identifying state resources which will enable the state to obtain
additional federal reimbursement during this unprecedented fiscal
crisis. It is further the intent of the Legislature that any program
identified by the department for the purposes specified in this
section shall not be modified or altered in any manner unless
subsequent statutory authority is expressly provided by the
Legislature.
   (b) Notwithstanding Section 14166.22, in order to maximize federal
claiming under the demonstration project, the department shall have
broad discretion to claim federal reimbursement consistent with all
applicable federal claiming rules for the following expenditures in
an order of priority determined by the department:
   (1) Expenditures in programs funded in whole or in part by
realignment funds under Chapter 6 (commencing with Section 17600) of
Part 5, including, but not limited to, the County Medical Services
Program.
   (2) Expenditures in programs funded in whole or in part by the
County Mental Health Services Act.
   (3) Other public expenditures, to the extent the department
determines the expenditures to be appropriate for claiming under the
demonstration project.
   (4) Expenditures in any programs referenced in subdivision (a) of
Section 14166.22 or other state-only funded programs as the
department, in its discretion, determines should be used for the
purposes of this section. These programs may include programs
administered by other state agencies or departments.
   (c) The department shall have discretion to claim under this
section for any and all additional demonstration project funding made
available pursuant to any amendments to the demonstration project
made on or after October 1, 2008, or pursuant to any federal laws
that increase the amount of available funding, including, but not
limited to, the federal American Recovery and Reinvestment Act of
2009 (P.L. 111-5). This additional funding shall include federal
funds made available due to an increase in the federal medical
assistance percentage in addition to any other increase in the amount
of federal funding.
   (d) Any amounts received in the 2008-09, 2009-10, and 2010-11
fiscal years from the federal government pursuant to additional
demonstration project funding as specified in this section shall be
deposited in the Federal Trust Fund. Notwithstanding Section 28.00 of
the Budget Act of 2009, the Department of Finance may authorize
expenditure of these funds in a manner consistent with federal law
and that offsets General Fund expenditures otherwise authorized in
the Budget Act of 2009 for the Medi-Cal program, and as appropriated
in Item 4260-101-0001 of Section 2.00 of that act, or for the Health
Care Support Fund. For any adjustments made under the authority
provided for by this section, the Department of Finance shall provide
notification in writing to the Chairperson of the Joint Legislative
Budget Committee not less than 30 days prior to the effective date of
the adjustment, or not sooner than whatever lesser time the
Chairperson of the Joint Legislative Budget Committee, or his or her
designee, may in each instance determine. The notification to the
chairperson of the joint committee shall include, at a minimum, the
amounts of the proposed appropriation adjustments, a description of
any assumptions used in making the adjustments, the relevant federal
authority, and any other clarifying description as relevant.
   (e) If the federal Centers for Medicare and Medicaid Services or
any federal or state court issues a ruling that any or all federal
dollars obtained by claiming for expenditures from any particular
program referenced in subdivision (b) cannot be used to increase
state revenues, the department may discontinue use of those
expenditures for claiming under this section and substitute other
expenditures from other programs referenced in subdivision (b) at its
discretion.
   (f) Notwithstanding Chapter 3.5 (commencing with Section 11340) of
Part 1 of Division 3 of Title 2 of the Government Code, the
department may implement this section by means of a provider
bulletin, or other similar instruction, without taking regulatory
action. The department shall also provide notification to the Joint
Legislative Budget Committee within five working days if that action
is taken in order to inform the Legislature that the action is being
implemented.
  SEC. 251.  Section 14167.3 of the Welfare and Institutions Code is
amended to read:
   14167.3.  (a) Private hospitals shall be paid supplemental amounts
for the provision of hospital inpatient services and subacute
services as set forth in this section. The supplemental amounts shall
be in addition to any other amounts payable to hospitals with
respect to those services and shall not affect any other payments to
hospitals.
   (b) Except as set forth in subdivisions (g) and (h), each private
hospital shall be paid the following amounts as applicable for the
provision of hospital inpatient services for each subject federal
fiscal year:
   (1) Six hundred forty-seven dollars and seventy cents ($647.70)
multiplied by the hospital's general acute care days.
   (2) Four hundred eighty-five dollars ($485) multiplied by the
hospital's acute psychiatric days that were paid directly by the
department and were not the financial responsibility of a mental
health plan.
   (3) One thousand three hundred fifty dollars ($1,350) multiplied
by the number of the hospital's high acuity days if the hospital's
Medicaid inpatient utilization rate is less than 41.1 percent, at
least 5 percent of the hospital's general acute care days are high
acuity days, and the hospital is not a small and rural hospital as
defined in Section 124840 of the Health and Safety Code. This amount
shall be in addition to the amounts specified in paragraphs (1) and
(2).
   (4) One thousand three hundred fifty dollars ($1,350) multiplied
by the number of the hospital's high acuity days if the hospital
qualifies to receive the amount set forth in paragraph (3) and has
been designated as a Level I, Level II, Adult/Ped Level I, or
Adult/Ped Level II trauma center by the Emergency Medical Services
Authority established pursuant to Section 1797.1 of the Health and
Safety Code. This amount shall be in addition to the amounts
specified in paragraphs (1), (2), and (3).
   (c) A private hospital that provides Medi-Cal subacute services
during a subject federal fiscal year and has a Medicaid inpatient
utilization rate that is greater than 5.0 percent and less than 26.10
percent shall be paid for the provision of subacute services during
each subject federal fiscal year a supplemental amount equal to 50
percent of the Medi-Cal subacute payments made to the hospital during
the 2008 calendar year.
   (d) (1) In the event federal financial participation for a subject
federal fiscal year is not available for all of the supplemental
amounts payable to private hospitals under subdivision (b) due to the
application of a federal limit or for any other reason, both of the
following shall apply:
   (A) The total amount payable to private hospitals under
subdivision (b) for the subject federal fiscal year shall be reduced
to reflect the amount for which federal financial participation is
available.
   (B) The amount payable under subdivision (b) to each private
hospital for the subject federal fiscal year shall be equal to the
amount computed under subdivision (b) multiplied by the ratio of the
total amount for which federal financial participation is available
to the total amount computed under subdivision (b).
   (2) In the event federal financial participation for a subject
federal fiscal year is not available for all of the supplemental
amounts payable to private hospitals under subdivision (c) due to the
application of a federal upper limit or for any other reason, both
of the following shall apply:
   (A) The total amount payable to private hospitals under
subdivision (c) for the subject federal fiscal year shall be reduced
to reflect the amount for which federal financial participation is
available.
   (B) The amount payable under subdivision (c) to each private
hospital for the subject federal fiscal year shall be equal to the
amount computed under subdivision (c) multiplied by the ratio of the
total amount for which federal financial participation is available
to the total amount computed under subdivision (c).
   (e) In the event the amount otherwise payable to a hospital under
this section for a subject federal fiscal year exceeds the amount for
which federal financial participation is available for that
hospital, the amount due to the hospital for that federal fiscal year
shall be reduced to the amount for which federal financial
participation is available.
   (f) The amounts set forth in this section are inclusive of federal
financial participation.
   (g) No payments shall be made under this section to a new
hospital.
   (h) No payments shall be made under this section to a converted
hospital for the subject federal fiscal year in which the hospital
becomes a converted hospital or for subsequent subject federal fiscal
years.
  SEC. 252.  Section 14167.6 of the Welfare and Institutions Code is
amended to read:
   14167.6.  (a) The department shall enhance payments to Medi-Cal
managed health care plans for the subject federal fiscal years as set
forth in this section.
   (b) The enhanced payments shall be made as part of the monthly
capitated payments made by the department to managed health care
plans.
   (c) The department shall determine the amount of the enhanced
payments to managed health care plans for each subject month
consistent with the following objectives:
   (1) Pay to managed health care plans in the aggregate the sum of
the individual hospital managed care supplemental payments for each
month.
   (2) Result in payment of the individual hospital managed care
supplemental payment to each subject hospital in accordance with
Section 14167.10.
   (3) Result in rates that may be certified as actuarially sound.
   (4) Result in rates that are approved by the federal government
for purposes of federal financial participation.
   (d) The department shall make enhanced payments to managed health
care plans exclusively for the purpose of making supplemental
payments to hospitals, in order to support the availability of
hospital services and ensure access for Medi-Cal beneficiaries.
Managed health care plans shall pass through enhanced payments to
hospitals in a manner determined by the department. The enhanced
payments to managed health care plans shall be made as follows:
   (1) The enhanced payments shall commence during the second month
following the month during which the quality assurance fee set forth
in Article 5.22 (commencing with Section 14167.31) is due and payable
from hospitals if the quality assurance fee includes funds for
enhanced payments to managed health care plans. The last enhanced
payments made pursuant to this section shall be made during December
2010.
   (2) The enhanced payments made during the first month in which
enhanced payments are made pursuant to this section shall include the
sum of the enhanced payments for all prior months for which payments
are due.
   (3) The enhanced payments made during December 2010 shall include
payments for December 2010 to September 2011, inclusive, to the
extent that federal financial participation is available for the
enhanced payments.
   (e) Payments to managed health care plans that would be paid in
the absence of the payments made pursuant to this section shall not
be reduced as a consequence of payment under this section.
   (f) (1) Each managed health care plan shall expend, in the form of
supplemental payments to hospitals, 100 percent of any rate enhanced
payments it receives under this section, pursuant to Section
14167.10.
   (2) Interest earned by the managed health care plans during timely
implementation of subdivision (b) of Section 14167.10 shall be in
lieu of any administrative fee that the department might otherwise
pay to the plans for implementation of this article.
   (3) The department may issue change orders to amend contracts with
managed health care plans on either a quarterly or semiannual basis
to adjust monthly capitation payments to coincide with updated
enrollment data so that the amounts paid to hospitals pursuant to
this section equals, or nearly equals, the amounts set forth in
subdivision (a) of Section 14167.10.
   (g) In the event federal financial participation is not available
for all of the enhanced managed care payments determined for a month
pursuant to this section for any reason, the enhanced payments
mandated by this section for that month shall be reduced
proportionately to the amount for which federal financial
participation is available.
   (h) Enhanced payments to a managed health care plan pursuant to
this section shall not be taken into consideration by the department
or the Department of Managed Health Care in determining the
percentage of total costs attributed to administrative costs for the
purposes of determining compliance with any administrative costs
limit, including, but not limited to, those described in Sections
14087.101 and 14464 of this code, Section 1378 of the Health and
Safety Code, and Section 1300.78 of Title 28 of the California Code
of Regulations.
   (i) Notwithstanding Chapter 3.5 (commencing with Section 11340) of
Part 1 of Division 3 of Title 2 of the Government Code, the
department shall implement this section by means of policy letters or
similar instructions, without taking further regulatory action.
  SEC. 253.  Section 14167.7 of the Welfare and Institutions Code is
amended to read:
   14167.7.  (a) The amount of any payments made under this article
to private hospitals, including the amount of payments made under
Sections 14167.2 and 14167.3 and additional payments to private
hospitals by managed health care plans pursuant to Section 14167.6,
shall not be included in the calculation of the low-income percent or
the OBRA 1993 payment limitation, as defined in paragraph (24) of
subdivision (a) of Section 14105.98, for purposes of determining
payments to private hospitals pursuant to Section 14166.11.
   (b) The amount of any payments made to a hospital under this
article shall not be included in the calculation of stabilization
funding under Article 5.2 (commencing with Section 14166).
  SEC. 254.  Section 14167.10 of the Welfare and Institutions Code is
amended to read:
   14167.10.  (a) (1) At the same time that the department makes an
enhanced payment to a managed health care plan under Section 14167.6,
the department shall notify the plan of each hospital to which the
plan shall make supplemental managed care payments as a consequence
of receiving the enhanced payment and the amount of the supplemental
payment. The department shall determine the amount of the
supplemental payment due to each subject hospital so that the total
supplemental managed care payments to the hospital from all managed
health care plans resulting from payments made to the managed health
care plans for the subject month under Section 14167.6 equals or
approximately equals the hospital's individual hospital managed care
supplemental payment.
   (2) In the case of the enhanced payments made to a managed health
care plan during the first month in which the payments are made to
the plan, the amounts of supplemental payments due to each hospital
pursuant to paragraph (1) shall be multiplied by the number of months
for which the enhanced payments were made.
   (3) The notice provided by the department in connection with the
enhanced managed care payments to each managed health care plan
during December 2010 shall also direct the managed health care plan
to make monthly supplemental payments to hospitals for months, if
any, from January 2011 to September 2011, inclusive, for which
federal financial participation is available as described in
paragraph (3) of subdivision (d) of Section 14167.6 and the amount of
the supplemental payments as calculated pursuant to this
subdivision.
   (b) Each managed health care plan receiving payments under Section
14167.6 shall make supplemental payments to hospitals within 30 days
of receiving the payments under Section 14167.6, except that if the
managed health care plan receives enhanced payments during December
2010, which include payments relating to some or all of the month of
January 2011 to September 2011, inclusive, the managed health care
plan shall make payments relating to the months of January 2011 to
September 2011, inclusive, during each month to which the payment
relates. The payments shall be made to those hospitals and in those
amounts set forth by the department in its notice provided pursuant
to subdivision (a).
   (c) The supplemental payments made to hospitals pursuant to this
section shall be in addition to any other amounts payable to
hospitals by a managed health care plan or otherwise and shall not
affect any other payments to hospitals.
   (d) For each subject federal fiscal year, the sum of all
supplemental payments made by a managed health care plan to subject
hospitals pursuant to this section shall equal, or approximately
equal, all enhanced payments received by the managed health care plan
from the department pursuant to Section 14167.6.
   (e) Managed health care plans shall not take into account payments
made pursuant to this article in negotiating the amount of payments
to hospitals that are not made pursuant to this article.
   (f) The obligations of a Medi-Cal managed health care plan to make
payments to a hospital for services furnished by the hospital that
are not covered by a contract between the managed health care plan
and the hospital, including the amounts of payments required apart
from payments under this article, shall not be affected by any
payments made under this article.
   (g) In the event federal financial participation for a month is
not available for all of the enhanced managed health care plan
payments pursuant to Section 14167.6 for any reason, the supplemental
payments made to hospitals under this section shall be reduced
proportionately to the amount for which federal financial
participation is available, and the department's notice under
subdivision (a) shall reflect that reduction.
   (h) No payments shall be made under this section to a new
hospital.
   (i) Any delegation or attempted delegation by a managed health
care plan of its obligation to make payments under this section shall
not relieve the plan from its obligation to make those payments.
Managed health care plans shall submit the documentation the
department may require to demonstrate compliance with this
subdivision. The documentation shall demonstrate actual payments to
hospitals, and not assignment to subcontractors of the managed health
care plan's obligation of the duty to pay hospitals. The department
and each managed health care plan shall make available to each
subject hospital, within 15 days of receipt of the hospital's written
request, documentation demonstrating the amount that the plan paid
to the subject hospital for a subject month and the amount due from
the plan to the subject hospital for the subject month.
   (j) If the department determines that a managed health care plan
has failed to pay any enhanced payment amounts it received pursuant
to Section 14167.6 to hospitals as required by this section, the
department shall immediately recover the amounts determined by an
offset to the capitation payments made to the managed health care
plan and by any other legal means available. At least 30 calendar
days prior to seeking any recovery, the department shall notify the
managed health care plan to explain the nature of the department's
determination, to establish the amount of the enhanced payment amount
in excess of supplemental payments
         to hospitals, and to describe the recovery process. The
department may terminate any or all contracts between the department
and a managed health care plan that fails to make payments as
required by this section.
   (k) The department shall pay to a managed health care plan or
plans, as the director determines is or are appropriate, any amounts
recovered under subdivision (j) for the purpose of making payments to
hospitals pursuant to this section and shall direct the managed
health care plan or plans receiving those amounts to make specific
payments to specific hospitals to ensure that hospitals receive the
amounts set forth in this section.
   (l) Managed health care plans shall in no event be obligated under
this section to make supplemental payments to hospitals that exceed
the enhanced payments made to the managed care health plans under
Section 14167.6.
  SEC. 255.  Section 14522.4 of the Welfare and Institutions Code is
amended to read:
   14522.4.  (a) The following definitions shall apply for the
purposes of this chapter:
   (1) "Activities of daily living (ADL)" means activities performed
by the participant for essential living purposes, including bathing,
dressing, self-feeding, toileting, ambulation, and transferring.
   (2) "Instrumental activities of daily living (IADL)" means
functions or tasks of independent living limited to hygiene and
medication management.
   (3) "Personal health care provider" means the participant's
personal physician, physician's assistant, or nurse practitioner,
operating within his or her scope of practice.
   (4) "Care coordination" means the process of obtaining information
from, or providing information to, the participant, the participant'
s family, the participant's personal health care provider, or social
services agencies to facilitate the delivery of services designed to
meet the needs of the participant, as identified by one or more
members of the multidisciplinary team.
   (5) "Facilitated participation" means an interaction to support a
participant's involvement in a group or individual activity, whether
or not the participant takes active part in the activity itself.
   (6) "Group work" means a social work service in which a variety of
therapeutic methods are applied within a small group setting to
promote participants' self-expression and positive adaptation to
their environment.
   (7) "Professional nursing" means services provided by a registered
nurse or licensed vocational nurse functioning within his or her
scope of practice.
   (8) "Psychosocial" means a participant's psychological status in
relation to the participant's social and physical environment.
   (9) "Assistance" means verbal or physical prompting or aid,
including cueing, supervision, stand-by assistance, or hands-on
support to complete the task correctly.
   (10) "Substantial human assistance" means direct, hands-on
assistance provided by a qualified caregiver, which entails
physically helping the participant perform the essential elements of
the ADLs and IADLs. It entails more than cueing, supervision, or
stand-by assistance to perform the ADLs and IADLs. It also includes
the performance of the entire ADL or IADL for participants totally
dependent on human assistance.
   (11) "Cognitive impairment" means the loss or deterioration of
intellectual capacity characterized by impairments in short- or
long-term memory, language, concentration and attention, orientation
to people, place, or time, visual-spatial abilities or executive
functions, or both, including, but not limited to, judgment,
reasoning, or the ability to inhibit behaviors that interfere with
social, occupational, or everyday functioning due to conditions,
including, but not limited to, mild cognitive impairment, Alzheimer's
disease or other form of dementia, or brain injury.
   (b) Upon the date of execution of the declaration described under
subdivision (g) of Section 14525.1, this section shall become
operative and Section 14522.3 shall become inoperative and on that
date is repealed.
  SEC. 256.  Section 14598 of the Welfare and Institutions Code is
amended to read:
   14598.  (a) The Legislature finds and declares both of the
following:
   (1) The demonstration projects authorized by this article have
proven to be successful at providing comprehensive, community-based
services to frail elderly individuals at no greater cost than for
providing nursing home care.
   (2) Based upon that success, California now desires to provide
community-based, risk-based, and capitated long-term care services
under the Programs of All-Inclusive Care for the Elderly (PACE) as
optional services under California's Medicaid state plan and under
contracts, entered into between the federal Centers for Medicare and
Medicaid Services, the department, as the single state medicaid
agency, and PACE organizations, meeting the requirements of the
Balanced Budget Act of 1997 (P.L. 105-33) and Part 460 (commencing
with Section 460.2) of Subchapter E of Chapter IV of Title 42 of the
Code of Federal Regulations.
   (b) The department may enter into the contracts specified in
subdivision (a) for implementation of the PACE program, and also may
enter into separate contracts with the PACE organizations contracting
under subdivision (a), to fully implement the single state agency
responsibilities assumed by the department in those contracts,
Section 14132.94, and any other state requirement found necessary by
the department to provide comprehensive community-based, risk-based,
and capitated long-term care services to California's frail elderly.
The department may enter into separate contracts specified in
subdivision (a) with up to 10 PACE organizations. The department may
not enter into any contracts specified in subdivision (a) unless a
Medicaid state plan amendment, electing PACE as a state Medicaid
option as provided for in Section 14132.94, has been approved by the
federal Centers for Medicare and Medicaid Services.
   (c) Notwithstanding subdivisions (a) and (b), any demonstration
project contract entered into under this article prior to January 1,
2004, shall remain in full force and effect under its own terms, but
shall not be renewed or amended beyond the termination date in effect
on that date.
   (d) The requirements of the PACE model, as provided for pursuant
to Section 1894 (42 U.S.C. Sec. 1395eee) and Section 1934 (42 U.S.C.
Sec. 1396u-4) of the federal Social Security Act, shall not be waived
or modified. The requirements that shall not be waived or modified
include all of the following:
   (1) The focus on frail elderly qualifying individuals who require
the level of care provided in a nursing facility.
   (2) The delivery of comprehensive, integrated acute and long-term
care services.
   (3) The interdisciplinary team approach to care management and
service delivery.
   (4) Capitated, integrated financing that allows the provider to
pool payments received from public and private programs and
individuals.
   (5) The assumption by the provider of full financial risk.
   (6) The provision of a PACE benefit package for all participants,
regardless of source of payment, that shall include all of the
following:
   (A) All Medicare-covered items and services.
   (B) All Medicaid-covered items and services, as specified in the
state's Medicaid plan.
   (C) Other services determined necessary by the interdisciplinary
team to improve and maintain the participant's overall health status.

   (e) For purposes of this section, "PACE organizations" means those
entities as defined in Section 460.6 of Title 42 of the Code of
Federal Regulations.
  SEC. 257.  Section 16124 of the Welfare and Institutions Code is
amended to read:
   16124.  (a) (1) Upon the appropriation of funds by the Legislature
for the purposes set forth in this section, the State Department of
Social Services shall establish a project in four counties and one
state district office of the department to provide preadoption and
postadoption services to ensure the successful adoption of children
and youth who have been in foster care 18 months or more, are at
least nine years of age, and are placed in an unrelated foster home
or in a group home.
   (2) The participating entities shall include the following:
   (A) City and County of San Francisco.
   (B) County of Los Angeles.
   (C) Two additional counties and one state district office, based
on criteria developed by the department in consultation with the
County Welfare Directors Association, which shall demonstrate
geographic diversity.
   (3) A county that elects to apply for funding pursuant to this
section shall submit an application to the department no later than a
date determined by the department to ensure timely allocation of
funds. The department shall review the applications received, and
select the eligible counties in accordance with this section.
   (b) Each entity identified pursuant to paragraph (2) of
subdivision (a) shall receive funding to provide preadoption and
postadoption services to the adoptive parents and the targeted
population identified in paragraph (1) of subdivision (a).
   (1) Preadoption and postadoption services for the child and each
family may include, but shall not be limited to, all of the
following:
   (A) Individualized or other recruitment efforts.
   (B) Postadoption services, including respite care.
   (C) Behavioral health services.
   (D) Peer support groups.
   (E) Information and referral services.
   (F) Other locally designed services, as appropriate.
   (G) Relative search efforts.
   (H) Training of adoptive parents, foster youth, or mentoring
families.
   (I) Mediation services.
   (J) Facilitation of siblings in the same placement.
   (K) Facilitation of postadoption contact.
   (L) Engaging youth in permanency decisionmaking.
   (M) Any service or support necessary to resolve any identified
barrier to adoption.
   (2) The services specified in paragraph (1) may be provided
directly by the county, contracted for by the county, or provided
through reimbursement to the family, as approved by the county.
   (c) The amount of funding provided in the appropriation of funds
provided by the annual Budget Act to each county participating in the
project shall be allocated as follows:
   (1) Seven hundred fifty thousand dollars ($750,000) to the City
and County of San Francisco.
   (2) One million two hundred fifty thousand dollars ($1,250,000) to
the County of Los Angeles.
   (3) A total of two million dollars ($2,000,000), to be awarded to
the two additional counties and the district office selected pursuant
to subparagraph (C) of paragraph (2) of subdivision (a), minus any
funds subtracted by the department for the purpose of administering
the project. The amount of funds provided to the department for
administration of the project, including the costs of collecting and
analyzing data pursuant to subdivision (h) and developing the
information pursuant to subdivision (i), shall not exceed three
hundred thousand dollars ($300,000).
   (4) If the appropriated amount in the annual Budget Act differs
from the total amount specified above, then the funds shall be
distributed in the same proportion as the amounts listed in
paragraphs (1) to (3), inclusive.
   (d) Funds shall be allocated to the counties pursuant to
subdivision (c) no later than January 1 of each year, and shall
remain available for expenditure until June 30, 2010.
   (e) (1) The department shall seek approval for any federal
matching funds that may be available to supplement the project.
   (2) The implementation of the project shall not be dependent upon
the receipt of federal funding.
   (3) Project funds shall supplement, and not supplant, existing
federal, state, and local funds, and shall be used only in accordance
with the terms and conditions of the project.
   (4) No expenditure made for services specified in subdivision (b)
may be made to the extent that it renders the family ineligible for
federal adoption assistance.
   (f) The project shall be implemented only upon the adoption of a
resolution adopted by each county board of supervisors.
   (g) The department shall work with the counties to develop the
requirements for the project, including the number of families that
may participate in the project, given the available resources, and
guidelines for data collection, as required by subdivision (h).
   (h) (1) The department shall work with the participating county
and the state district office to analyze the effects of the project.
   (2) Measures assessed by the state and counties shall include, but
shall not be limited to, the following:
   (A) The extent to which the adoptions of the targeted population
identified in paragraph (1) of subdivision (a) increased as a result
of the project.
   (B) The number of families and children served by the project.
   (C) The type and amount of preadoption and postadoption services
that were provided to children and families under the project.
   (i) The department shall provide information to the Legislature on
the results of the project by May 31, 2011.
   (j) Adoption programs in the project counties shall be encouraged
to create public-private partnerships with private adoption agencies
to maximize their success in improving permanent outcomes for older
foster youth.
  SEC. 258.  Section 18220.1 of the Welfare and Institutions Code is
amended to read:
   18220.1.  Of the amount deposited in the Local Safety and
Protection Account in the Transportation Fund authorized by Section
10752.2 of the Revenue and Taxation Code, the Controller shall
allocate 6.50 percent in the 2008-09 fiscal year and 5.85 percent in
the 2009-10 fiscal year and each year thereafter. The Controller
shall allocate these funds on a quarterly basis beginning April 1,
2009, to the Department of Corrections and Rehabilitation. The
department shall allocate the funds appropriated in the Budget Act of
2008 and included in the Local Safety and Protection Account among
counties that operate juvenile camps and ranches based on the number
of occupied beds in each camp as of 12:01 a.m. each day, up to the
Corrections Standards Authority rated maximum capacity, as determined
by the Corrections Standards Authority.
  SEC. 259.  Section 18987.62 of the Welfare and Institutions Code is
amended to read:
   18987.62.  (a) Upon request from a county, the director may waive
regulations governing foster care payments or the operation of group
homes to enable counties to implement the agreements established
pursuant to Section 18987.61. Waivers granted by the director shall
be applicable only to services provided under the terms of the
agreement and for the duration of the agreement, whichever is
earlier, unless the director authorizes an extension of the waiver
pursuant to subdivision (f). A waiver shall only be granted when all
of the following apply:
   (1) The agreement promises to offer a worthwhile test of an
innovative approach or to encourage the development of a new service
for which there is a recognized need.
   (2) The regulatory requirement prevents the implementation of the
agreement.
   (3) The requesting county proposes to monitor the agreement
through performance measures that ensure that the purposes of the
waived regulation will be achieved.
   (b) The director shall take steps that are necessary to prevent
the loss of any substantial amounts of federal funds as a result of
the waivers granted under this section. The waiver may specify the
extent to which the requesting county shall share in any cost
resulting from any loss of federal funding.
   (c) The director shall not waive regulations that apply to the
health and safety of children served by participating private
nonprofit agencies.
   (d) The director shall notify the appropriate policy and fiscal
committees of the Legislature whenever waivers are granted and when a
waiver of regulations was required for the implementation of the
county's proposed agreement. The director shall identify the reason
why the development of the services outlined by the agreement between
the county and the service provider are hindered by the regulations
to be waived.
   (e) The county or private nonprofit agency shall fund an
independent evaluation of the waiver, as described in subdivision (f)
of Section 18987.61.
   (f) The director may grant a county's request to extend the waiver
for up to an additional three years based upon a review and analysis
of all of the following information:
   (1) The results of the report, if required under subdivision (e)
of Section 18987.61.
   (2) The results of the independent evaluation of the waiver,
pursuant to subdivision (e) of this section.
   (3) Justification for the extension, and verification of continued
compliance with this section.
   (g) (1) For any waiver approved on or before January 1, 2010, an
extension of the waiver for up to an additional three years may be
based upon the department's review and analysis of the information
required to be submitted in subdivision (f).
   (2) If an independent evaluation has not yet been completed, the
department may grant an extension based upon its review of available
information. However, an independent evaluation shall be required to
be completed within one year prior to the end of the waiver.
  SEC. 260.  Section 5.1 of the Castaic Lake Water Agency Law
(Chapter 28 of the Statutes of 1962, First Extraordinary Session), as
amended by Chapter 688 of the Statutes of 2008, is amended to read:
   Sec.5.1.  (a) Notwithstanding any other provision of the Castaic
Lake Water Agency Law, the number of directors on the board shall be
as follows:
   (1) One nominee for the office of appointed director shall be
nominated by each purveyor and submitted in writing to the board of
directors. The board of directors shall appoint each nominee within
30 days after the nomination is submitted, or may within the same
time period by resolution reject any nominee for cause which is
documented in the resolution by a detailed statement of reasons. If
the board of directors rejects a nominee of any purveyor, the
affected purveyor shall promptly submit a second and different
nominee to the board of directors. The board of directors shall
appoint the second nominee within 30 days after the second nomination
is submitted, or may within the same time period likewise by
resolution reject that second nominee for cause which is documented
in the resolution by a detailed statement of reasons. If the board of
directors rejects any second nominee of any purveyor, the affected
purveyor shall select a third and still different nominee, which
nominee shall be entitled without further board action to take an
oath of office as required by law and to thereafter serve as an
appointed director of the agency.
   (2) A nominee of a purveyor may be a shareholder, director,
officer, agent, or employee of the nominating purveyor, and shall be
a registered voter within Los Angeles County or Ventura County. Any
nominee of a purveyor who is the chief executive officer, chief
operating officer, or the general manager of the purveyor shall be
rejected for appointment only on the ground that the nominee is
legally disqualified from holding the office of director by reason of
a provision of law applicable to appointed directors of the agency.
   (3)  The term of office of an appointed director is four years.
   (4) Upon expiration of an initial term of office of an appointed
director, the office of that appointed director shall be filled
pursuant to Section 5.2. If a vacancy occurs in the office of an
appointed director, it shall be filled in the same manner as is
provided in subdivisions (a) and (b) of Section 5.2 for the
appointment of a successor appointed director, except that the
purveyor or its successor in interest to which the vacancy relates
shall within not more than 60 days of the occurrence of the vacancy
nominate a person for appointment to the vacant office, and the
vacant office shall be filled by the board of directors not later
than 30 days after that nomination.
   (5) An incumbent in the office of appointed director shall be
subject to recall by the voters of the entire agency in accordance
with Division 11 (commencing with Section 11000) of the Elections
Code, except that any vacancy created by a successful recall shall be
filled in accordance with the procedure provided by this section for
a vacancy created other than by a recall election.
   (b) (1) Notwithstanding any other provision of the Castaic Lake
Water Agency Law, if the agency acquires a private water purveyor,
the term of office of the director appointed by the private purveyor
shall terminate at noon on the first Monday after January 1 of the
year following the acquisition.
   (2) The successor to the director described in paragraph (1) shall
be elected at-large by agency voters at the statewide general
election held in November of the even-numbered year following the
acquisition, and shall take office at noon on the first Monday after
January 1 of the year following the election. The successor and each
elected director thereafter to hold the office described in this
subdivision shall hold office for the term of four years from the
date of taking office and until the election and qualification of the
next director to hold that office.
   (3) The elected office described in paragraph (2) shall cease to
exist upon the abolishment of the offices of appointed directors
pursuant to subdivision (c) of Section 5.2.
   (4) Paragraph (1) shall not be effective with respect to the
director appointed by the Santa Clarita Water Company until a court
of competent jurisdiction issues a final decision holding that the
agency acquired the company.
  SEC. 261.  Section 1 of the Osteopathic Act, as amended by Section
69 of Chapter 18 of the 2009-10 Fourth Extraordinary Session, is
amended to read:
  Section 1.  A self-sustaining Osteopathic Medical Board of
California to consist of seven members and to be known as the
"Osteopathic Medical Board of California" is hereby created and
established. The Governor shall appoint the members of the board,
each of whom shall have been a citizen of this state and in active
practice for at least five years next preceding his or her
appointment. Five of the members shall be appointed from among
persons who are graduates of osteopathic schools who hold unrevoked
physician's and surgeon's D.O. licenses or certificates to practice
in this state. Two members shall be naturopathic doctors licensed
under the Naturopathic Doctors Act (Chapter 8.2 (commencing with
Section 3610) of Division 2 of the Business and Professions Code). No
one residing or practicing outside of this state may be appointed
to, or sit as a member of, the board. The Governor shall fill by
appointment all vacancies on the board for the unexpired term. The
term of office of each member shall be three years, provided that, of
the first board appointed, one shall be appointed for one year, two
for two years, and two for three years, and that thereafter all
appointments shall be for three years, except that appointments to
fill vacancies shall be for the unexpired term only. No member shall
serve for more than three full consecutive terms. The Governor shall
have power to remove from office any osteopathic physician and
surgeon member of the board for neglect of duty required by the
Osteopathic Act or Medical Practice Act (Chapter 5 (commencing with
Section 2000) of Division 2 of the Business and Professions Code).
The Governor shall have power to remove from office any naturopathic
doctor member of the board for neglect of duty required by the
Naturopathic Doctors Act. The Governor shall have power to remove any
member of the board for no longer complying with the residency or
practice requirements of this section, for incompetency, or for
unprofessional conduct. Each member of the board shall, before
entering upon the duties of his or her office, take the
constitutional oath of office. All fees collected on behalf of the
Osteopathic Medical Board of California and all receipts of every
kind and nature shall be reported at the beginning of each month for
the month preceding, to the Controller and at the same time the
entire amount must be paid into the State Treasury and shall be
credited to a fund to be known as the Osteopathic Medical Board of
California Contingent Fund, which fund is hereby created. The
contingent fund shall be for the use of the Osteopathic Medical Board
of California and out of it and not otherwise shall be paid all
expenses of the board. Each member of the board shall receive a per
diem and expenses as provided in Section 103 of the Business and
Professions Code, provided that the fees and other receipts of the
board are sufficient to meet this expense.
   The Governor shall appoint the members of the board within 30 days
after this act takes effect. The board shall be organized within 60
days after the appointment of its members by the Governor by electing
from its number a president, vice president, and a secretary who
shall also be the treasurer, who shall hold their respective
positions during the pleasure of the board. The board shall hold one
meeting during the first quarter of each calendar year at a time and
place designated by the board with power of adjournment from time to
time until its business is concluded. Special meetings of the board
may be held at such time and place as the board may designate. Notice
of each regular or special meeting shall be given twice a week for
two weeks next preceding each meeting in one daily paper published in
the City of San Francisco, one published in the City of Sacramento,
and one published in the City of Los Angeles which notice shall also
specify the time and place of holding the examination of applicants.
The secretary of the board upon an authorization from the president
of the board, or the chairperson of the committee, may call meetings
of any duly appointed committee of the board at a specified time and
place and it shall not be necessary to advertise those committee
meetings. The board shall receive through its secretary applications
for certificates to be issued by the board and shall, on or before
the first day of January in each year, transmit to the Governor a
full report of all its proceedings together with a report of its
receipts and disbursements.
   The office of the board shall be in the City of Sacramento.
Suboffices may be established in Los Angeles and San Francisco and
records as may be necessary may be transferred temporarily to those
suboffices. Legal proceedings against the board may be instituted in
any one of the three cities.

      The board may from time to time adopt rules as may be necessary
to enable it to carry into effect the provisions of this act. It
shall require the affirmative vote of a majority of the members of
the board to carry any motion or resolution, to adopt any rules, pass
any measure or to authorize the issuance or the revocation of any
certificate. Any member of the board may administer oaths in all
matters pertaining to the duties of the board and the board shall
have authority to take evidence in any matter cognizable by it. The
board shall keep an official record of its proceedings, a part of
which record shall consist of a register of all applicants for
certificates under this act together with the action of the board
upon each application.
   The board shall have the power to employ legal counsel to advise
and assist it in connection with all matters cognizable by the board
or in connection with any litigation or legal proceedings instituted
by or against the board and may also employ clerical assistance as it
may deem necessary to carry into effect this act. The board may fix
the compensation to be paid for those services and may incur other
expense as it may deem necessary, provided, however, that all of that
expense shall be payable only from the fund hereinbefore provided
for and to be known as the Osteopathic Medical Board of California
Contingent Fund.
   This section shall remain in effect only until January 1, 2013,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2013, deletes or extends that date.
  SEC. 262.  Section 1 of the Osteopathic Act, as added by Section 70
of Chapter 18 of the 2009--10 Fourth Extraordinary Session, is
amended to read:
  Section 1.  A self-sustaining Osteopathic Medical Board of
California to consist of five members and to be known as the
"Osteopathic Medical Board of California" is hereby created and
established. The Governor shall appoint the members of the board,
each of whom shall have been a citizen of this state and in active
practice for at least five years next preceding his or her
appointment. Each of the members shall be appointed from among
persons who are graduates of osteopathic schools who hold unrevoked
physician's and surgeon's D.O. licenses or certificates to practice
in this state. No one residing or practicing outside of this state
may be appointed to, or sit as a member of, the board. The Governor
shall fill by appointment all vacancies on the board for the
unexpired term. The term of office of each member shall be three
years, provided that, of the first board appointed, one shall be
appointed for one year, two for two years, and two for three years,
and that thereafter all appointments shall be for three years, except
that appointments to fill vacancies shall be for the unexpired term
only. No member shall serve for more than three full consecutive
terms. The Governor shall have power to remove from office any member
of the board for neglect of duty required by the Osteopathic Act or
Medical Practice Act (Chapter 5 (commencing with Section 2000) of
Division 2 of the Business and Professions Code), for no longer
complying with the residency or practice requirements of this
section, for incompetency, or for unprofessional conduct. Each member
of the board shall, before entering upon the duties of his or her
office, take the constitutional oath of office. All fees collected on
behalf of the Osteopathic Medical Board of California and all
receipts of every kind and nature shall be reported at the beginning
of each month for the month preceding, to the Controller and at the
same time the entire amount must be paid into the State Treasury and
shall be credited to a fund to be known as the Osteopathic Medical
Board of California Contingent Fund, which fund is hereby created.
The contingent fund shall be for the use of the Osteopathic Medical
Board of California and out of it and not otherwise shall be paid all
expenses of the board. Each member of the board shall receive a per
diem and expenses as provided in Section 103 of the Business and
Professions Code, provided that the fees and other receipts of the
board are sufficient to meet this expense.
   The Governor shall appoint the members of the board within 30 days
after this act takes effect. The board shall be organized within 60
days after the appointment of its members by the Governor by electing
from its number a president, vice president, and a secretary who
shall also be the treasurer, who shall hold their respective
positions during the pleasure of the board. The board shall hold one
meeting during the first quarter of each calendar year at a time and
place designated by the board with power of adjournment from time to
time until its business is concluded. Special meetings of the board
may be held at such time and place as the board may designate. Notice
of each regular or special meeting shall be given twice a week for
two weeks next preceding each meeting in one daily paper published in
the City of San Francisco, one published in the City of Sacramento,
and one published in the City of Los Angeles which notice shall also
specify the time and place of holding the examination of applicants.
The secretary of the board upon an authorization from the president
of the board, or the chairperson of the committee, may call meetings
of any duly appointed committee of the board at a specified time and
place and it shall not be necessary to advertise those committee
meetings. The board shall receive through its secretary applications
for certificates to be issued by the board and shall, on or before
the first day of January in each year, transmit to the Governor a
full report of all its proceedings together with a report of its
receipts and disbursements.
   The office of the board shall be in the City of Sacramento.
Suboffices may be established in Los Angeles and San Francisco and
records as may be necessary may be transferred temporarily to those
suboffices. Legal proceedings against the board may be instituted in
any one of the three cities.
   The board may from time to time adopt rules as may be necessary to
enable it to carry into effect the provisions of this act. It shall
require the affirmative vote of three members of the board to carry
any motion or resolution, to adopt any rules, pass any measure or to
authorize the issuance or the revocation of any certificate. Any
member of the board may administer oaths in all matters pertaining to
the duties of the board and the board shall have authority to take
evidence in any matter cognizable by it. The board shall keep an
official record of its proceedings, a part of which record shall
consist of a register of all applicants for certificates under this
act together with the action of the board upon each application.
   The board shall have the power to employ legal counsel to advise
and assist it in connection with all matters cognizable by the board
or in connection with any litigation or legal proceedings instituted
by or against the board and may also employ clerical assistance as it
may deem necessary to carry into effect this act. The board may fix
the compensation to be paid for those services and may incur other
expense as it may deem necessary, provided, however, that all of that
expense shall be payable only from the fund hereinbefore provided
for and to be known as the Osteopathic Medical Board of California
Contingent Fund.
   This section shall become operative on January 1, 2013.
  SEC. 263.  Section 1 of Chapter 226 of the Statutes of 2009 is
amended to read:
  Section 1.  (a) The Legislature finds and declares that it has long
been established in California that a horse racing association and
its parimutuel operation are actually only holding the stakes. The
funds wagered are not the property of the racing association. The
racing association merely holds the funds wagered until the results
of the race are known, then the association pays the winning wagers,
and holds funds for others pursuant to the California Horse Racing
Law. It has always been known that the funds due the various
distributees are not the property of the racing association. The
racing association is merely acting as a trustee until the funds are
paid to those as provided for in statute.
   (b) It is therefore the intent of the Legislature that the purpose
of this act is not to change California law, but merely to codify
this trustee relationship.
  SEC. 264.  Section 2 of Chapter 405 of the Statutes of 2009 is
amended to read:
  Sec. 2.  Section 1.5 of this bill incorporates amendments to
Section 25660 of the Business and Professions Code proposed by both
this bill and AB 1191. It shall only become operative if (1) both
bills are enacted and become effective on or before January 1, 2010,
(2) each bill amends Section 25660 of the Business and Professions
Code, and (3) this bill is enacted after AB 1191, in which case
Section 1 of this bill shall not become operative.
  SEC. 265.  Section 3 of Chapter 426 of the Statutes of 2009 is
amended to read:
  Sec. 3.  This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
   In order for the California Citrus Pest and Disease Prevention
Committee to, among other things, develop a work plan to deal with
the recent discovery in Santa Ana of Asian citrus psyllids, a tiny
insect that often carries citrus green disease, a pathogen that has
destroyed groves in Florida and wiped out much of the citrus
industries in China, India, Saudi Arabia, Egypt, and Brazil, it is
necessary for this act to take effect immediately.
  SEC. 266.  Any section of any act enacted by the Legislature during
the 2010 calendar year that takes effect on or before January 1,
2011, and that amends, amends and renumbers, adds, repeals and adds,
or repeals a section that is amended, amended and renumbered, added,
repealed and added, or repealed by this act, shall prevail over this
act, whether that act is enacted prior to, or subsequent to, the
enactment of this act. The repeal, or repeal and addition, of any
article, chapter, part, title, or division of any code by this act
shall not become operative if any section of any other act that is
enacted by the Legislature during the 2010 calendar year and takes
effect on or before January 1, 2011, amends, amends and renumbers,
adds, repeals and adds, or repeals any section contained in that
article, chapter, part, title, or division.